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Atlanta Internet Buyers: Proof of Cash Funds Letter Must For Everyone

By
Real Estate Broker/Owner with Atlanta Homes ODAT Realty - Love our Great City - Love our Clients! Buckhead - Midtown - Westside

Atlanta Internet Buyers:
Proof of Cash Funds Letter Must For Everyone

Atlanta Internet Buyers - Proof of Funds Letter A Must For Everyone for every purchase. Any offer must be substantiated for the Seller to consider it. Any person could say they have the money in Cash to make the offer more appealing. The PoF Letter verifies the availability of the money.

While one wishes it isn't true, agents have (KNOWINGLY) submitted Cash offers to get to the top of consideration and then request a change to Mortgage once their contract is accepted. Not an honest approach...

ONE EXCEPTION:

In the Georgia Association of Realtors Forms, F79 deals with an ALL CASH SALE.  Included in Item #1 is a Buyer option to supplement the capacity for All Cash with a Mortgage. If the Seller agrees to that stipulation, then the change is already part of the Purchase and Sale Agreement. 

The key component is transparency and honesty within the Offer.

GAR Form F79, in Item #3, includes the phrase "funds ... and/or assets". That means the Seller may determine that selling Assets is, or is not, acceptable. Why? Because  ABLE TO GET the Cash is not the same as HAVING the Cash.

 

Elizabeth Weintraub Sacramento Real Estate Agent, Top 1% of Lyon Agents, listed the following items that are not actually Cash in one of her posts :

  In the process of selling stocks or mutual funds

-   Holding a certificate of deposit that has not yet matured

-   Borrowing money from a relative

-   Refinancing a personal residence to raise the cash

-   Waiting for a probate court to distribute assets

-   Borrowing against securities

-   Liquidating funds from a retirement account

-   Obtaining a mortgage secured to the property they are buying

 

 

 Cash means CASH - not the ability to get it.  The Seller needs PROOF that if the offer is accepted, the transaction will progress and Close on time.

 

 In addition:

  • The Seller may ask the Buyer for the Proof of Funds Letter to be Notarized before the letter will be accepted.
  • The Seller may ask for a different form of Proof of Funds which could be a copy of the Account Statement for the Cash. [Of course, any account numbers should be redacted before the statement is submitted.]

Most Atlanta Internet Buyers are looking for the best deal they can get for their purchase. Having their Proof of Funds Letter ready ahead of time is a very important step.

Readiness may make the difference between losing out because Buyer had not prepared ahead or being the successful Offer for the Purchase.

Icon courtesy of "anonymous".
Draft of POF letter FOR ILLUSTRATION ONLY.
Not suggested as a Legal Document since author is not an attorney.

Comments (6)

Nina Hollander, Broker
Coldwell Banker Realty - Charlotte, NC
Your Greater Charlotte Realtor

Great post, Lynne. People, including many agents, really don't understand "cash" in a transaction. As far as I'm concerned, prove that you have the cash on hand... if you want to finance, that's fine, but first prove that you have the cash.

Jan 01, 2018 06:25 AM
Lynn B. Friedman CRS Atlanta, GA 404-617-6375

Nina Hollander 
Yes, and changing the type of financing changes the contract in Georgia unless specified already. I seem to remember Kathleen Daniels writing a post about the same thing in CA. Perhaps other states also consider it a true contract modification. Happy New Year! L.

Jan 01, 2018 10:18 AM
Tim Maitski
Atlanta Communities Real Estate Brokerage - Atlanta, GA
Truth, Excellence and a Good Deal

Lynn,  Are you saying that a brokerage account with unsold stocks and mutual funds is not considered cash?  Would it have to be actual cash in the account and not the value of stock or mutual funds?

Jan 01, 2018 08:28 AM
Lynn B. Friedman CRS Atlanta, GA 404-617-6375

Tim Maitski 
Thanks for your question which suggested to me I needed a clarification. I added a snippit of the GAR form for more detail. As long as the Seller is aware of the "definition" of All Cash and accepts what the Buyer is offering - then it is transparent to everyone.


Please see Comment #4 from Kathleen Daniels.
Happy and Healthy New Year to you and your family, Lynn


 

Jan 01, 2018 11:21 AM
Hannah Williams
HomeStarr Realty - Philadelphia, PA
Expertise NE Philadelphia & Bucks 215-820-3376

Very important post Lynn B. Friedman  and something everyone should ask for

Jan 01, 2018 08:40 AM
Lynn B. Friedman CRS Atlanta, GA 404-617-6375

Hannah Williams 
I appreciate your stopping by! Happy and Healthy New Year to you and your family! Lynn

Jan 01, 2018 11:22 AM
Kathleen Daniels, Probate & Trust Specialist
KD Realty - 408.972.1822 - San Jose, CA
Probate Real Estate Services

Dear Lynn,  

We look at liquidating those non-cash "cash" assets - inquire as to how long it takes to liqidate and when the funds will be in the account.  In my area, for the most part, proof of funds is a current bank statement. Rarely do I see a letter from the bank.  

Happy 2018 - Happy Happy Everything from Sunny San Jose, CA! 

Jan 01, 2018 09:42 AM
Lynn B. Friedman CRS Atlanta, GA 404-617-6375

Kathleen Daniels 
Glad to have your approach as part of the Comments!
Happy New Year my CA friend - Lynn

Jan 01, 2018 11:32 AM
Endre Barath, Jr.
Berkshire Hathaway HomeServices California Properties - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Lynn, Happy New Year, here in California as well as I am confident anywhere in the US, sellers want the Proof of Funds (POF) before they would consider accepting an All Cash Offer. The California Association of Realtor Purchase agreement allows 72 ours from acceptance to provide POF, good agents will not allow that, rather they want the buyer to provide it with the offer. The ones that have real funds do not mind and understand.... I personally prefer a copy of a Bank Account with the account blackened out... Great Localism Post to see how business id done in GA...

Jan 01, 2018 09:29 PM
Andy Brown-Climer School of Real Estate
The Climer School of Real Estate - Orlando, FL
The Best Real Estate School in Florida

Lynn, good job on getting this blog out. Google's spiders and crawlers use blogs for their SEO rankings and love original content and the right keywords.

Jan 18, 2019 03:59 AM