All Forum Posts by: David Cheng

I send an edited pdf of a bank statement. And put a disclaimer these funds will be moved to the LLC for acquisition. Has not failed me once, but rarely get asked.

If the funds exceed the transaction in talk, I don't withdraw or edit or any of that. Some real estate agents think because the funds show more they can play tougher, but I always let them know the funds in there are for specific deals with this one being priced where my bid is. Take it or leave it, don't get cute, and I put them on the clock then.

Hi @David Cheng,

For this pricepoint I agree with the other posters, I'd have an agent represent you.  Cut through the people that can't afford it and get serious buyers only.  

Asking for POF (lender pre-approval, bank statement, line of credit etc) for a property like you have is perfectly normal. If the buyers are working with an agent, the buyer's agent should already have that. If they are coming direct, it is probably because they see you are representing yourself and hoping for a deal. If it is hard money for half the amount then you need to see something that shows the rest. Don't waste your time with anyone who is pushing back on this. Showing occupied properties can be hard to coordinate and should only be for serious buyers. My 2 cents!

It sounds like this might have been some sort of "creative financing" scenario where the buyer has $0 but is trying to cobble together 3 liens and 8 JV partners to buy something they cant afford. I wouldn't sweat it. If I was in your shoes, I wouldnt waste my time with an unqualified buyer. If they cant be bothered to provide basic proof that they can close before tying up your time, then they will be a nightmare to deal with once under contract.

This is literally what a pre-approval letter from a lender does - it shows that a lender has taken a solid look at the buyer and confirmed that there is a decent probability that they will get the loan needed to close. If they wanted to send a hard money pre-approval for half of the purchase, then either A) the lender needs to confirm that they verified the borrower possesses the remaining cash to close, or B) the borrower needs to show proof of funds for the remainder. I regularly call sellers on behalf of my buyer clients that I have preapproved and walk the seller through the rigor of my preapproval process to prevent this exact situation. 

@David Cheng that agent doesn't sound like someone you'd want to work with anyway. That said, as a buyers agent, I've vetted my clients, and find it a bit insulting for listing agent to demand POF or pre-approval just to show. As a listing agent, I pre-arrange a specific weekly or biweekly time window with existing tenants and arrange all showings within that timeframe, with POF/pre-approval required with offers. If buyer won't accommodate time frame, making it difficult, then we may get picky unless buyers agent convinces me otherwise. I prefer to trust that buyer's agents don't want to waste time with unqualified buyers, especially with occupied homes. If buyer not represented, however, I make sure I have seen pre approval or POF before showing so I don't waste my own time.

You have nothing to prove to anyone, @David Cheng, and there's no need to apologize. It’s your property and you can sell it FIBO, with an agent, by any other legal means, or give it to the ASPCA. Asking for proof of funds is reasonable. A proof of funds letter without any credible evidence to support it is empty rhetoric and a waste of your time. So, who was the real jackass?

When we are asked for a proof of funds, I will write a letter, likely similar to the one you received, and I always include a redacted bank statement. Evidence like this is standard among all HMLs I know. Why else should anyone believe us?

Any agent who believes that providing a complete proof of funds letter, which they don’t even prepare, is jumping through hoops is simply lazy. If he or she were representing me, it would not be for long.

It’s your property, David. Stick to your guns.

I think @Jay Hurst nailed it on the head. When you ask for "proof of funds" it sounds like you will only consider a cash offer NOT a financed offer.

You should be asking for any kind of pre-approval letter as well.

It sounds like you would benefit from hiring a real estate agent to represent you. This is exactly the sort of thing they would handle for you seamlessly. That agent should not have spoken to you that way, but my guess is that they were frustrated. Its harder dealing with FSBO (forsale by owner) properties. Dealing with other agents is much simpler.

 @David Cheng    Are you only taking cash offers?  

To me, any liquidity qualifies: bank letters, bank statements, stocks in an investment account that covers down payment, etc.

@David Cheng

If you think Property Management is below your hourly rate dealing with the city to try and get either of these options is way below that. The time and headache isn’t worth it.

Find a good property manager. ( I can connect you, as prefer not to manage in the City of Dallas )

You say that hiring a property manager will bring down your returns. That’s only because you’re not paying yourself anything as the property manager. Add in your salary and then make an apples to apples comparison.

Good property management will make you money. You get your time back, and can spend it doing things you would prefer to do.