Recently I’ve had two situations near Destin Florida where a real estate buyer’s agent would not provide their buyer’s proof of funds with a contract on one of my listings. What is proof of funds? It may be either a bank letter or statement showing adequate cash available to purchase a property, or it could be a lender’s pre-qualification letter showing the buyer may be able to obtain a loan for the amount specified in a purchase and sale agreement. A pre-qualification letter is not a final mortgage approval or even a pre-approval, but it’s commonly the best you can get prior to a buyer finding a specific home, when full loan underwriting is performed.
Why is it important to get proof of funds before accepting an offer? Because you will need to remove your house from “Active” status in the Emerald Coast Association of Realtor’s MLS once an offer becomes a contract. Most agents will not show their buyers your home nor will a buyer be interested if you already have a contract on your property, so you want to only take your property off the market with evidence that a buyer can complete his transaction. If he does not provide proof of funds, it could be cause for concern. Proof of funds is always required when a buyer is purchasing a short sale or a foreclosure. The short sale lender or foreclosing bank or entity will demand it. I process many short sale listing transactions in Destin, Santa Rosa Beach, Niceville and Crestview and this is always the case. An individual seller may not require proof of funds, but I would advise against it.
I’ve had two recent Destin area listings where the buyers were well-known builders in the area. In each case the buyer’s agent either was afraid to ask for the builder’s proof of funds or the builder refused to provide it. This really is unacceptable, as a builder is not above the standards of protocol for a real estate purchase. In the end, it is my seller’s decision regarding how they want to proceed. One buyer’s agent simply responded to my email requesting proof of funds: “Their money is solid as a rock.” That’s not proof of funds to me!
Wendy Rulnick, Broker, Rulnick Realty, Inc.
Call 850-650-7883 ext 204
Email Wendy: [email protected]