When the real estate market is a seller's market - you probably expect your house to sell very quickly, and hopefully with a LOT of offers. In fact, maybe you want to have an all out bidding war
How Will You Pay For That House
Dated: May 22 2015
In real estate, you never know someone’s situation and I’ve learned not to make any assumptions. That works in both directions. Don’t assume someone DOESN’T have money and also don’t assume someone DOES have money.
When you start the buying process your real estate agent will likely talk to you about how you plan on paying for the house. If you have cash that’s GREAT! They might take you at your word but you should be prepared for the seller to need some proof. That’s where proof of funds comes into play. It could be as simple as a print out of your bank statement, money market or a letter from your bank vouching that you have the money.
If you plan on getting a loan from a bank you should be prepared for your real estate agent to request you get pre-approved before getting too involved in the buying process. I explain it to my clients this way, “You don’t want to spend months shopping for your perfect house to find out that someone has stolen your identity, or you have a blemish on your credit in need of repair, or that you fell in love with a house $10,000 outside your bank approved budget. It’s better to know this information before you mentally move into a house.” Would you rather be prepared than be sad?
When your agent presents your offer to the seller’s agent they will need to be prepared with an approval letter or proof of funds. Some sort of documentation to prove that you are able to fulfill the terms of the contract that you’re proposing.
Recently, a millionaire made a cash offer on one of my listings. Cash offers in real estate are not uncommon and always require proof of funds. How would I know he was a millionaire? So his agent provided a letter from the bank vouching for him. Word on the street is that millionaire buyer was a little miffed that he had to provide proof. Moral of the story? Real Estate is an even playing ground – even millionaires have to provide proof of funds.
In the competitive Des Moines market, Heather Wright combines client-focused service, innovative marketing techniques, and a decade of experience to make sure that your buying or selling experience is....