Proof of Funds Letter For REO Offers


I mentioned a few posts ago that I was working on a new website that is going to include a FAQ section… I’m not sure how long it’s going to take before it’s up and running, but until then, I thought I would post some of the common questions that I get from you guys. So, without further ado (did I spell that correctly?), here is FAQ #1……

Hi Steph,

I am getting ready to make my first offer on an REO and the listing agent is asking me to submit proof of funds with my offer if I am going to make a cash offer. I do not have the cash available. How do I get around this obstacle? The listing agent says she will not even submit my offer until I have a proof of funds letter. What do you use when making offers? I really want to get started making offers, but have run into this road block. Any help or advice is appreciated.

Thank you,


Yes, it is true, almost all banks will require you to submit either proof of funds if you are making a cash offer, or a pre-approval letter if you are making an offer with a financing contingency. There is really no way around this. The banks want to see that you have the ability to close (understandably), and they want to see proof of your ability to close before they will consider your offer.

When I first got started, I was using a generic letter from a national hard money lender (can’t remember which one), and then one day, one of the listing agents called me up and told me that my letter was a joke (he didn’t use those words, but that’s what he was getting at), and told me that if I wanted to be taken seriously, I needed a letter that wasn’t so vague (my letter did not contain the property address, it just stated that I was approved if the LTV was below 65%). After that, I started using a statement from a line of credit (my Dad’s), and now I am using a letter from a friend of mine who will fund deals for me provided the price is right (my offers are always ridiculously low, so the price is always right).

If you do not have the cash to close, and do not have access to a line of credit, and do not have a private money lender to fund your deals, then you are pretty much screwed. Just kidding. Actually, there are now lenders who will provide “transactional funding” or “flash funding” for your short sale and REO deals. These lenders will provide you with the cash to close the first half (the sale between you and the bank) of your short sale and REO deals- for a fee, of course. Also, some of them will provide you with a proof of funds letter to submit with your offers. The company I recommend is Fund This

Keep in mind that they will only fund your deal if you have a buyer already lined up for the second transaction. They only do back to back closings, so if you do not have a buyer lined up, you are not going to get the funding to close the first half of the deal. Here is the FAQ page for Fund This Wholesaler that explains their service in greater detail.

I hope that clarifies things a little for all of you out there who have questions regarding proof of funds and REO offers…

Now get on out there and start making some offers!!!

If you have questions, please feel free to post them in the comments section so everyone can benefit. I will still answer private emails, but it might take me awhile to get back to you. :)

I hate my new Blackberry. I’m giving myself until Friday to learn to like it, and if not, I’m taking it back and getting one without a touch screen.

  1. On November 25, 2008 at 12:34pm, Scott Costello said...

    I’ll take the new black berry off your hands. :) I’ve wanted one of those since I read about it a few months ago.

  2. On November 25, 2008 at 12:43pm, Stephani said...

    It’s a royal pain in my ass. It takes me forever to write emails and texts because of the stupid touch screen. I guess my fingers are too fat.

    I almost chucked it out of my car window today.

  3. On November 25, 2008 at 2:38pm, Antonio said...

    Hi Stephanie. I really am enjoying your posts here. I really want to get started now and wholesale a house in the next 20-25 days so that my family can have a Christmas. I just ended a partnership in a restaurant that did’nt make it. My credit is shot to hell and I am virtually penniless right now. After reviewing some of the previous posts I think that with enough hustle on my part, I can possibly make something happen before Christmas. I just went out and purchased 30 blank signs to try and build a buyers list and I am blessed enough to have access to the MLS through a family friend. If you were in my shoes, with no budget and alot of time on your hands what steps would you take to 1: find a deal on the MLS, 2: put it under contract 3: find the deposit money to secure the contract with the bank, and 4: Close the deal. Any guidance that you can give me would be greatly appreciated.

  4. On November 25, 2008 at 2:58pm, Kyle-OH said...


    I had the touchscreen and I also did not like it at all. I was always pressing things other then what I wanted. I now have the blackberry curve and its the best phone that Ive had. Its not a touch screen but does EVERYTHING I ever wanted and its easy to use. BTW I have t-mobile…

  5. On November 25, 2008 at 3:08pm, Stephani said...

    Hi Antonio,

    Thanks for stopping by..

    This is probably not what you want to hear, but if I were in your shoes (actually, I was in your shoes, about a year ago), I would get some sort of job just so that I had a little bit of cash coming in. If you have restaurant experience, maybe you could wait tables or bar tend at night, and then work your real estate biz during the days.

    I jumped in full time last year and I did not have any savings, and I did not know what the hell I was doing…let me tell you- it was BRUTAL.

    Despite what many of the guys say who are trying to sell you courses and mentoring programs- this business is HARD WORK, especially in the beginning, and there is a HUGE learning curve. I’ve been busting my ass for 2 years straight, and only now am beginning to feel like I really know what I’m doing.

    I am not trying to discourage you in any way, I’m just trying to tell you honestly how it really is. Maybe it will be easier for you, but for me, it took a long time for things to finally start to click…

    Anyway, on to your questions…

    You are at a great advantage having access to the mls. I would start out by getting to know a few neighborhoods really well- study the comps to see who is buying what, and for how much. Call “for rent” signs and ask the landlords if they are looking for more properties, and if so, what price do they need to buy at. Call the “we buy houses” signs in the area and start networking with other wholesalers. Once you get a good feel for the neighborhood, and understand what a deal looks like in this particular area (this could take awhile), then, I would start making offers, and shopping them to your investors that you found while getting to know the neighborhood.

    Good luck, and feel free to come back with questions if you have them.


  6. On November 25, 2008 at 3:11pm, Stephani said...

    Hi Kyle,

    I think I am going to go back and get the Curve (the pink one).

    This thing is driving me nuts.


  7. On November 25, 2008 at 5:55pm, Bill said...

    Hi Steph – Great post!! I look forward to your new faqs. Coastal Funding is a great source for transactional funding. Tell your readers to ask for Eric and I’m sure he can hook ‘em up with a proof of funds letter.

  8. On November 26, 2008 at 10:11am, Anonymous said...

    Steph, can you maybe use a stylus (like a pen without ink or a point) instead of your finger? They sell extra styli for the Palm PDAs at computer stores, probably just a buck or two.

  9. On November 26, 2008 at 5:33pm, jasonhh said...

    Hey Steph,

    It took me a minute to get used to typing on a touch screen (iPhone), I’m assuming that is what is driving you crazy? If not, blow off the following: it does take a bit to get used to when typing, but once you get the hang of it, it’s awesome and easy.
    Give it a minute, you’ll get it.
    If that’s not the problem, why do you hate it?
    Are you nuts? I wouldn’t go near a gadget store on Friday!!
    iPhones, @#$$ yeah! Errr..


  10. On November 28, 2008 at 11:12am, Stephani said...


    I thought about getting a stylus, but it just seems like a pain to have to carry that around, too- and I’m really bad at losing/misplacing things, so that would probably be lost within a week or 2.


    Yes, it is the touchscreen that I am having issues with. I am getting better at it, though, and think it is just going to take a few weeks before I get used to it.

    I didn’t realize Friday was the day after Thanksgiving when I wrote the post- I’d rather saw my limbs off than go anywhere near a mall/gadget store on Black Friday. No way.

  11. On December 08, 2008 at 4:09pm, Jarred said...

    I have a way to Flip any REO or Short-Sale you can use funds that are only 1%. Plus the title Co works with the people who are lending the money and have an 80% close Ratio Contact me if your interested

    [email protected]

  12. On December 09, 2008 at 7:43am, Darlene said...

    You can also try Rocky Valley Properties, Inc. at

    Fees are only 1% + $300 flat fee

    Proof of funds letter and letter of funding for submitting offers

    Fund in any state

    No credit, No risk transaction

    Also require to have end buyer

    No LTV either

  13. On February 11, 2009 at 12:04am, Anonymous said...

    I Have closed a total of 7 deals with Eric and Ryan over at and I can tell you they are the real deal. They have saved the day in many ways for me. For one they set me up with a nationwide title company who is in Tampa Fl who closes Land Trust deals. This was the first deal they funded for me and was during a time when title comapanies would not close land trust. Never late on the money. As soon as title is ready they wire funds for my deals to close. You wont be sorry. 800-262-6036 direct to Eric. It’s almost to good to be true and if I had not seen for my own eyes. No upfront fees no charges if deal doesnt close and the list goes on. I have called the 1% guys and it seems like a marketing scheme?? Good Luck!

  14. On February 11, 2009 at 12:08am, Anonymous said...

    Coastal Funding
    800-262-6035 – Eric Direct

    I noticed I had a typo in the last post. I hope this helps some of you like it did my business.