I have a pressing question about foreclosures. We have looked at a few houses and all of them are asking for proof of funds. We want to secure the property and get it under contract first, then seek our financing through a hard money lender. Since a hard money lender bases his/her decision on the overall deal, how do we provide proof of funds, when esentially, we have none. Money isn’t going to be a problem, but how do we get around this? Should we send a proposal to a hard money lender first? They won’t submit any offers without proof of funds. Any and all advise would be appreciated!
You can ask almost any HML for a pre-approval letter and they will give you one. Heck, some have them on their websites and all you do is insert your name, company, etc. in the blanks.
OR if you have lines of credit established places, then dump all your finances into an account for a day or two and then take it out… it doesn’t show seasoned funds, but it could (and has for me) work when people require proof of funds. Now with a lender, this WILL NOT work, only with sellers.
Cheers,
Stephen Bingemer
Also beware that even pre approval on traditional financing DOES NOT fly with a home that is not livable, it has to pass lender’s qualifications. I met a brick wall today thinking my pre approval would be my saving grace on a rehab home I was planning to get and use Home Depot to get fix up materials. NO GO! Lender won’t do it, now I’m scurrying around for other funding with only about $3500 to put down.