Home Buying in 94114>Question Details

Linda, Home Buyer in 94114

I am purchasing a home with cash and I was asked to provide proof of funds. I am uncomfortable with showing a bank statement. Is there another way?

Asked by Linda, 94114 Wed Feb 22, 2012

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33
Just get your bank statement with all the pages, even the blank pages, cross all but the last 4 digets of the account and send give that to you agent to send over with your offer.

Good Luck!
1 vote Thank Flag Link Tue Mar 6, 2012
Well this post is 2 years old, but it's still a common question, so here's a quick answer anyway:

Having a letter from your bank that states you have sufficient funds for the cash purchase should be sufficient for most sellers and listing agents. Make sure your bank includes your name, the property address, and offer amount in the letter, and that is signed from a bank manager or someone with the authority to demonstrate you have the funds needed. I've used this type of letter in several all-cash offers in the past, and never had an issue with it.

Alternatively, you can black out any information on your bank statement that you're uncomfortable sharing.
0 votes Thank Flag Link Sun Sep 28, 2014
I have actually had my buyer's financial planner (or Bank rep) write a letter on bank letter head stating that they have more than enough cash assets to purchase the subject property. With that they invite the listing agent to contact them directly should they have additional questions...it worked!
0 votes Thank Flag Link Fri Sep 12, 2014
Everybody is missing the fact that this buyer is using CASH so asking her lender or FANNIE MAE rules aren't the issue here. She wants (wanted) to know what she can do to provide proof of funds for a CASH purchase.

She needs to get her statements from the accounts where she's getting the cash. They'll have her name on them. Cross out COMPLETELY the account number. Nobody needs that. With some accounts it's only one page, like a brokerage account or a pension fund. With checking accounts it will be more. Cross out EVERYTHING but the balance. Use a Sharpie.Then make a copy and give to the seller or his or her listing agent.

It's up to the seller (and the listing agent) what the seller will accept as proof. It's NOT the same as a financed purchase.
0 votes Thank Flag Link Thu Oct 24, 2013
I cannot speak about having an official letter from the bank stating that the funds are there. I do know that Fannie Mae requires all bank account information (Part B, Origination Through Closing,
Subpart 3, Underwriting Borrowers , Chapter 4, Asset Assessment, Verification of Depository Assets) :

Copies of bank statements or investment portfolio statements. The statements must cover
account activity for the most recent two-month period (or, if account information is reported
on a quarterly basis, for the most recent quarter). The statements must:
– clearly identify the borrower as the account holder,
– include the account number,
– include the time period covered by the statement,
– include all deposits and withdrawal transactions (for depository accounts),
– include all purchase and sale transactions (for financial portfolio accounts), and
– include the ending account balance.

I really do not like this, but it appears it is done day in and day out with (hopefully) no problems. The fact is that if you do not like this request, there ARE other means of verifying funds. This is probably just the easiest and accepted method.

Good luck.
0 votes Thank Flag Link Thu Aug 9, 2012
You can have your bank manager write a letter confirming funds are available. Obviously make sure date and phone number are included. But I am sure you bank has done this for other customers as most people are uncomfortable showing a bank statement.
0 votes Thank Flag Link Fri Mar 9, 2012
Get a bank check in the amount needed. That should satisfy them
0 votes Thank Flag Link Mon Mar 5, 2012
You could ask that your agent show your bank statement to the listing agent to verify balances and then returned to you with no copies made. (Make sure to white out all account information first.) Or you could ask if the seller would be OK with a letter from your bank stating the available balance in the account.
0 votes Thank Flag Link Sun Mar 4, 2012
Either a letter from your bank that states that you have the cash, or you can provide a bank statement but be sure to white out acct. no and SS number. I prefer my clients provide a bank letter.
0 votes Thank Flag Link Sat Mar 3, 2012
You can always ask your lender for a letter stating that you have the resources that are needed to complete the transaction
0 votes Thank Flag Link Sat Mar 3, 2012
You can have an officer of the bank draft a letter stating you have funds to cover the purchase. Sometimes that works.
0 votes Thank Flag Link Thu Mar 1, 2012
Showing a bank statement after your offer has been accepted isn't an unreasonable request. If you were getting a mortgage you would have to show a pre-approval letter from a lender, with a cash offer it's providing proof of sufficent funds available.

You could ask your bank or portfolio manager to write a letter on offical letter head stating you have siufficient funds available to purchase and the Sellers may accept this as satisfactory evidence.

Good Luck.
0 votes Thank Flag Link Thu Mar 1, 2012
Hi Linda,

When you'll be presenting your offer to the seller, and suppose there are other buyers on the table, the seller needs to make sure that you can pay should they accept your offer. The same goes with buyers who are financing their purchase via a loan, the sellers prefer to see a pre-qualification or pre-approval letter.

It's nothing personal and you can cover your account number if you want. As long as they can see that the account is under your name and that there is sufficient funds.

Good luck and please let me know if you need assistance,

Best regards
Mimi
0 votes Thank Flag Link Wed Feb 29, 2012
Sorry you are uncomfortable with showing a bank statement, but I would be more comfortable as would Homeland Security as to knowing where your money is coming from, hence the reason you have to show where your funds are and that they exist! The Real Estate agency can not take your word alone as concrete for a buyer that you have the funds to buy the home. You make the offer it gets accepted, so you have to prove you have the funds and Homeland Security may ask as to where you got the funds.
0 votes Thank Flag Link Wed Feb 29, 2012
The reason it is perfectly normal to have to provide proof of funds is because when you are making a cash offer - you are stating that you do not need to obtain a mortgage. As a cash buyer - you are more valuable since the likelihood of the deal taking place is not tied with your ability to get financing. You can expect to get a better deal compared with buyers who need financing. Proving your funds confirms that the buyer will not try to change the rules in the middle of the game after the lower offer is accepted and state that there is no cash available to buy outright.

Real estate agents and brokers deal with confidential financing information on a regular basis as a part of their daily routines. Let us say that your bank balance greatly exceeds what you are trying to buy the house for. Ask if your bank can issue you a letter stating that your bank balance was at least X number of dollars. Also, see if you can get away with whiting out your account number for privacy reasons. Other than that, the only thing I can suggest is to not make cash offers.
0 votes Thank Flag Link Wed Feb 29, 2012
To be honest, if you have to ask this question in a World Wide Web. Your agent is not worth your money. This is not where this question should be in 1st place. And to the rest of the answers on this question, the immediate and genuine answer should have been: "Talk to the agent's Broker: PERIOD!"
0 votes Thank Flag Link Wed Feb 29, 2012
Great advice below. Showing proof of funds is standard practice. If we're going to commit to opening escrow, you'll need to prove you have the ability to pay for the home, or I'm going to have to find another buyer.

I once had an agent say they needed to see account numbers, which my buyer was not comfortable with. It was a fight, but I eventually won that battle after going to the agents broker and stating it was an unreasonable request.
0 votes Thank Flag Link Wed Feb 29, 2012
The best way to handle this is to white out your account numbers and address if applicable. They basically just want to see your name and amount of savings on a bank's letterhead.
0 votes Thank Flag Link Wed Feb 29, 2012
All good recommendations below and the request for proof of funds is an industry wide customary practice.
0 votes Thank Flag Link Wed Feb 29, 2012
Any good agent will want you to provide proof that you actually have the money. You will run into this problem purchasing a home no matter what you buy. With the accounts blacked out there is nothing they can do. If it is a matter of not wanting them to know how much then open a separate account with the money amount you want to spend on the house. I personally would not except a letter from the bank without seeing the funds.
Web Reference: http://Www.laura4homes.com
0 votes Thank Flag Link Thu Feb 23, 2012
Good Morning,
You have gotten tremendous advice from other professionals already. Congratulations.
Best.
Maria
0 votes Thank Flag Link Thu Feb 23, 2012
Have your bank write a letter to verify funds - on official bank stationary, naturally.
0 votes Thank Flag Link Wed Feb 22, 2012
I always have my clients blacken out the account numbers and social security (if on there.) We have never had a problem. Just make sure to use a strong black pen as mentioned below,

Good luck,
Sally
0 votes Thank Flag Link Wed Feb 22, 2012
It is standard policy to ask for proof of funds on a cash deal, and it makes sense - they want to know you have the money to close the deal. As pointed out below, you can black out any account numbers to avoid giving out private information while still demonstrating you have sufficient money. This is done all the time with no issues.

Best Regards,

Lance King/Owner-Managing Broker
lance@fixedrateproperties.com
415.722.5549
DRE# 01384425
0 votes Thank Flag Link Wed Feb 22, 2012
I have my clients cut off the account number or use a strong black out pen to cover their personal information. Another way is also to have your lender state in the pre approval letter that they have verified funds. Hope this helps.

Jan Maddock
Prudential CA Realty
Serving the Greater San Francisco Bay Area
925-212-2882
0 votes Thank Flag Link Wed Feb 22, 2012
We lenders use a standard Verification of Deposit (VOD) form in cases like these. Once completed by the bank, you can simply black out the account numbers and provide to the seller. The VOD will not show the line-by-line information as would a statement, and it may prevent the need to get someone who is authorized and willing at the bank to write a letter.

Just a thought, but let me know if you have questions or need help.

Rob Spinosa
rspinosa@rpm-mtg.com
0 votes Thank Flag Link Wed Feb 22, 2012
You can show a bank statement with your account information blacked out or you can ask the bank for a "proof of funds" letter. Most of them have their own format and may require that you transfer the amount of the funds that they verify into a restricted account for a period of time. For example, their letter might say "We hereby verify that Joe Schmo has $40,000 in our bank. This letter expires in 120 days." During the 120 days the bank may require that you place $40,000 in a CD or account that can only release the money after the letter expires. Ask your bank or wherever you have the money deposited. Good luck!
0 votes Thank Flag Link Wed Feb 22, 2012
You may try going online and adding a new account at your bank. Then transfer only the amount you would like to show into that account. Print and submit your new statement.

Best of luck,

Oggi Kashi - 415.690.3792 direct
Broker Associate, Paragon Real Estate Group CA DRE 01844627
All data from sources deemed reliable but subject to errors and omissions, and not warranted.
Web Reference: http://www.oggikashi.com/
0 votes Thank Flag Link Wed Feb 22, 2012
There is two ways around it: for confidentiality purpose, you can block your bank account number and provide it to your agent ( as long as the account is under your name ). The second way is to ask your financial representative to provide a letter to confirm the cash amount available in your account for the amount of purchase.

Providing the proof of funds for a cash purchase is needed in order to give confidence to the seller that you are qualified for the purchase.
Good luck!

Manzar D. Azari, MBA, Broker, Realtor
Founder/President
The Azari Group Real Estate, Inc.
http://www.theazarigroup.com
0 votes Thank Flag Link Wed Feb 22, 2012
You can always cross out the account number, or provide only the portion of statements that show you have sufficient cash for that particular transaction.

But if you are asking a seller to take his/her property off the market, forsake all other buyers in your favor, it is not unreasonable for the seller to want to know that you are able to perform.

Astrid Lacitis
Keynote Properties
415 860 07675
0 votes Thank Flag Link Wed Feb 22, 2012
Such a letter DOES NOT provide proof that the buyer can perform. After all, I can transfer funds into an account, get the letter stating the funds are available and then transfer the funds out of the account. It proves nothing!
Flag Fri Apr 25, 2014
You have a couple of options: 1. Have your bank issue a letter on the bank's letterhead stating that you have sufficient funds for the purchase, 2. Provide your bank account, but sanitize your account number and other personal information.
0 votes Thank Flag Link Wed Feb 22, 2012
Hi Linda,

Go into one of your bank branches and ask the bank manager to write you a letter stating:
"This member has XX,XXX dollars on deposit in cash or cash equivalent at XYZ Bank."
On letterhead with a phone number and that should do it.

Good luck.
Frank Diaz
(RA) MBA, e-PRO, REALTOR®
East Oahu Realty
http://hawaiihome.biz/
0 votes Thank Flag Link Wed Feb 22, 2012
what if you don't have it in your bank? what if it was in a safty deposit box
Flag Sat Jan 4, 2014
Hi Linda,
Just black out the account number. I do this all the time. As long as your name is visible you should be OK.
Good luck,
0 votes Thank Flag Link Wed Feb 22, 2012
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