Friday, April 16, 2010

A Great Resource for Flippers, Landlords and Wholesalers

So we all need to give proof of funds in REO's we purchase from time to time. And it's a major hassle to contact your bank and ask them OVER and OVER for these letters, when your offer may be so low that the likelihood is it's going to get rejected anyway. So you're making your bank do all of this work time and time again and you know they'll eventually get compensated for it through a slightly higher interest rate because you're a pain in the you know what.

So what do you do? Why not just get a proof of funds letter from a transactional lender? Most banks will be satisfied with it. Get it here

For you wholesalers, this particular transactional lender will finance your entire back to back closing (double closing or simultaneous closing) including legal fees. They cover the A (seller) to B (you) closing. Then later that day the B (you) to C (end buyer) happens and they get their money and you get yours.

This is a type of closing used for wholesalers who do not want the end buyer to know what your purchase price was. Assignments cost a whole lot less in legal fees and are the preferred method. Personally, I could care less what the wholesaler paid for the property. I already know it's hard to find property within my Rent X 30 Minus Repairs buying criteria. All I care about is meeting my "junker" criteria.

Here's what a proof of funds letter looks like from a transactional lender:


Dail Stancill on April 17, 2010 at 8:28 AM said...

Right on!

Daniel Rich on April 17, 2010 at 11:14 PM said...

I've seen these before. Has anyone used these proof of funds letters and do banks actually accept them?

Real Estate Investors of Roanoke™ on April 18, 2010 at 6:10 PM said...

Yes, I use them on EVERY REO offer I give. 95% of the time they are fine with it. If they aren't, I could care less, I just won't buy that property because I don't have the time for banks to make me jump through these ridiculous hoops.

I have the money to buy it if I am putting an offer in on it and it is an insult in my opinion to force me to prove that I have it.

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