My wife and I are brand new at the real estate investing. We have been looking at a several properties and feel that we may have found one that is a great deal. However, after talking to the listing agent of the property, they seller is requiring proof of cash to submit with the offer.
Because we don’t have any money yet, what do we need to do to show proof of cash as a wholesaler since we are not buying the property?
Money talks plain and simple. They want to see that you have the money to do the deal. If you don’t have the money to show them, or your means of obtaining money for the purchase, you are not the type of buyer they want to waist their time dealing with.
You should watch your step if you are trying to be the middle man who never has anything more than their time at stake (unless you have your real estate license). The feds are really cracking down on illegal and questionable real estate practices.
Showing them the money is my dilemma! Our “plan” was to put the contract on the table, and then contact a few investors that we have already talked to about properties. In wholesaling deals, we aren’t using our own money but the money of our buyer, correct?
What are ways you could show them proof of cash without using our own money?
If you don’t have the funds available and the Realtor is adamant about seeing the dough, you can get a hard money lender. Contact the hard money lender and tell him that you need an approval letter to prove that you have capital available and can close quickly.
If it truly is a good deal, most hard money lenders will lend up to 70 -75% of the after repaired value. Your credit or available cash is a non-issue here. If a hard money lender is refusing to touch it…it’s probably not that good of a deal after all. Realtors have a tendency to inflate a bad to marginal deal into some great investment.
Another option is to find a partner with cash. Have them put up the money and you manage the deal…split it 50/50
Feel Free To Ask Any Other Questions That You May Have…