Don't Be Offended When a Seller Asks for Proof of Funds

Here is something I think more buyers need to understand. If you are purchasing a home with cash and the seller or listing agent asks for proof of funds, please do not take offense.

It is not that we do not trust you. And it is certainly not that we are trying to get into your personal finances. We are simply doing our job and protecting our sellers. At Venture North Real Estate Co, I work with sellers near Crivitz and across the Northwoods, and this comes up more than buyers expect.

When someone submits a cash offer, it is reasonable for the seller to want verification that the buyer has the funds to complete the purchase.

The seller is potentially taking their home off the market, turning away other interested buyers, and making plans based on your offer. Wouldn't you want to know that the person buying your home actually has the funds to close?

Does every seller require it? No. Is it legally required with every offer? No. But can a seller request it before accepting an offer? Absolutely.

It is a pretty standard part of a cash transaction. If you have been looking at homes and submitting cash offers, and your buyer's agent has never discussed proof of funds with you, I am not sure why that conversation has not happened.

As a listing broker, I believe it is an important part of representing my sellers responsibly.

Proof of funds does not mean handing over your entire financial history. Typically, a bank statement or a letter from your financial institution showing sufficient available funds will do. Sensitive account information can be redacted.

So please, do not be offended when we ask. We are not questioning your character or your financial success. We are verifying the offer you are asking our seller to accept. And if I were representing you as a seller, I would do exactly the same thing.

This fits with how sellers weigh offers more broadly. I wrote about that in why the highest offer is not always the best offer.

If you are thinking about selling, start with selling your home. If you are buying or selling in Crivitz and Surrounding Areas and want to talk through how offers work, get in touch.

Kathryn Conard
Broker/Owner | Venture North Real Estate Co.