Home Buying in Phoenix>Question Details

Nia, Real Estate Pro in Phoenix, AZ

Bank wants proof of downpayment!

Asked by Nia, Phoenix, AZ Tue Dec 23, 2008

We signed all paperwork on our approved offer last week or so. Selling bank still hasn't signed the paperwork that they rushed us to sign.

Selling agent called our agent saying they need proof (cashier's check or something) that we have the 25k downpayment we said we would offer! They need it in 2 hours!

My husband told our agent that it isn't the selling bank's business because it's OUR bank's business (Bank of A.)!

We do have the funds but of course we can't get it overnight!

Can they really ask us for proof of our downpayment?! Are they just having second thoughts about selling it to us?

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Nia:

I am not in your market, however I found your post interesting. I have assisted many clients with foreclosures and short sales and have never had a buyer provide proof of their downpayment. Proof of funds (bank statement for cash offers) or lender pre approval letter if financing.

It is not unusual for the selling bank to take their time signing their end of the paperwork. Until you recieve their addenda and both the seller and buyer signatures, you are not legally in contract.

If you do not want to provide your personal information, then counter offer. If it is standard language in their addendum, they may not waive it for you. At that point you need to decide whether it is worth killing the deal over. If I were in your position, I would go online to your bank and print your asset statement where your dp money is coming from. You can white out the account numbers and this should be sufficient.

Best of luck,
1 vote Thank Flag Link Tue Jan 6, 2009
Don't provide information that is none of their business.

You have a contract in your accepted offer. If they break it, that will be actionable and you will be due damages.

You should hope they break the contract.
1 vote Thank Flag Link Tue Dec 23, 2008
Banks operate by the Golden Rule- He who has the Gold, makes the rules. It is very typical that they want proof of your required closing funds and they will not rely on your bank to do its job of verifying your source of DP funds (even THEY dont trust each other!)... Banks are institutional sellers who have learned over 1000's of sales that "Buyers are Liars...." and now they just insist on items such as this. If you want to play with foreclosures, you need to play by their rules, and proof of funds is one of them. I doubt they are having second thoughts- they are just ensuring they really do having someone capable of making a deal...and they won't take your word for it- experience has told them thats not prudent!
1 vote Thank Flag Link Tue Dec 23, 2008
Nia,

It is very common these days for banks (or sellers in general) to request a POF (proof of funds). This is more typical in cash offers, but in cases where there is a substantial down payment, it is common practive for them to ask for it.

As for the 2 hrs time, that is probably too much! If you are interested in the propoerty you can probably just sent them a copy of your bank statement with the funds in there - covering some personal data of course. They can not force you to provide that documentation, but they can condition the approval on getting the POF.

It is not that they are having second thoughts, it is that they want to make sure you are a solid buyer. Your agent will be able to provide you with more information.

Good luck!
1 vote Thank Flag Link Tue Dec 23, 2008
Rod is correct- and likely, there are provisions in the banks addendums that require this proof of funds- they may find themselves in breach for not providing it.
0 votes Thank Flag Link Wed Dec 24, 2008
Jeff - they have no contract until the selling bank signs the paperwork. Sounds like all they have for now is a initial verbal acceptance, which is common in bank sales.
0 votes Thank Flag Link Tue Dec 23, 2008
My husband just got off the phone with our mortgage loan officer and he also said that the selling bank has no business asking for proof of downpayment. He said he'll calll our agent to find out what's going on.
0 votes Thank Flag Link Tue Dec 23, 2008
Nia,

Work with your Realtor on this.

If you want the property, comply with the banks request.

Proof of Funds is common practice.

Good Luck,

Stew
0 votes Thank Flag Link Tue Dec 23, 2008
We did offer all of our bank of america documents that prove we DO have the full loan amount and more. We even sent a 1000 dollars earnest money. All this was submittted at time of offer placement. However, we just didnt' think the selling bank was justified in asking for proof of the downpayment.

To my knowledge, bank of america pays the FULL loan amount to the selling bank, and it is with BANK of america that we deal with in regards to the downpayment! So the selling bank shouldn't be asking for it! Am i not right?
0 votes Thank Flag Link Tue Dec 23, 2008
NO with any listing need proof of downpayment, what about a letter of statement from the bank. This should have been attached to sales offer when you submitted, There are many BS buyers out there proof of statement for financing is a priority. Prior to moving forward with any other contract obligations .
Web Reference: http://www.lynn911.com
0 votes Thank Flag Link Tue Dec 23, 2008
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