Hello all! I’m a new investor who looks forward to having great conversation with fellow new investors and also seasoned pros.
I started making offers on properties with the intent to wholesale. My problem is, I was making the offers with financing, not cash offers and they are being turned down, if even looked at. I have a realtor I’m working with who has experience with investors and she said only cash offers are being looked at in this current market. She said investors are using proof of funds letters with their offers. My question to someone who has experience is what type of proof of funds letter are you using with cash offers or are you making offers with financing?
Hi,
You didn't give an indication of where you are - city and state?
I am out in the west and California, Arizona and Nevada are my prime territory! Owners whether banks, lenders or private owners start out looking for retail pricing for there properties, whether REO, Short Sales or Retail Owner Occupied Sellers as time passes all of these parties get more flexible on what they will except! Your real estate agent or the listing agent must present all offer’s to the sellers by state law! At closing everything is “Cash” to seller!
You may however need to make 30, 40, 50 or 75 offers to get one excepted depending on where you are! If you think an agent is not presenting your offer talk to his or her broker and just inquire about the offer you made 4 days ago and whether he or she (Broker) knows anything about your offer or could follow up and let you know as you have not been able to get ahold of your agent! (I do not accuse the agent of not submitting my offer as I obviously don’t know the facts but the broker will follow up as his license and business are on the line if his agent is excepting but not presenting all offer’s as required by law)
Quite frankly out here in the “Wild West” there are not enough buyers for all properties on the market and sellers have to look at excepting any offer whether all cash or financing with 45, 60 or 90 days to close just to get properties sold! Out here even bidding at the foreclosure auction and paying immediately your title may not be processed and vested to you for 3 or 4 weeks!
I either use my mortgage broker’s approval form letter or my transactional funder’s proof of funds letter! But I make 98% of my offer’s with financing and contingencies for REO’s (Bank Owned) properties! I very rarely make all cash offer’s as when I wholesale to my end buyer they are likely using Conventional, FHA, VA, Private Money or Hard Money for closing and may need inspections, must have title insurance and usually need 20 to 30 days minimum to close considering a 3 or 4 week period to process and vest title!
GR
Gold River,
Thanks for the great advice. I live in Alabama and I’ve made about 20 offers using financing contingency. If I’m reading your post correctly, it may take submitting many many offers to get one accepted. Especially with how low I’m going on the offers.
Absolutely. It is a numbers game…
Great question. The number 1 thing i found was that each case is different. I use the proof of funds letter on this site or from my transactional funding company when it works if not build a relationship with one of your buyers and use their hard proof of funds ( ie bank statement) for making offers. I have done this successfully for years and made great money!