What kind of proof of funds should I require from a cash buyer before accepting an offer?

Ask for a recent bank or brokerage statement, or a letter from their financial institution, showing enough liquid funds to cover the full price. The name on it should match the buyer or their company. Your account numbers can be redacted. In Texas you can also require proof of funds within a set number of days in the contract and make the earnest money due quickly to title. A short option period keeps your home from being tied up too long. If they won't provide proof, move on. Has the investor already sent a written offer, or just the email so far? Happy to answer questions anytime. David Smith, your local agent advisor with Compass, (346) 569-2583.

POF: Letter from buyer's financial institution, sent directly to your email by the institution and not forwarded by buyer. Nick Nikolov | The Nikolov Team Brokered by HomeSmart |

It's completely reasonable to ask for proof of funds before accepting a cash offer. A recent bank or brokerage statement (with sensitive account information redacted) or a letter from the buyer's financial institution confirming sufficient funds are both common forms of verification. If a buyer is serious, they should have no issue providing this. It helps ensure they're fiancially capable of closing and can save you time by avoiding offers that aren't backed by actual funds.

You want to make sure you see the funds amount or greater in a bank statement or sometimes a buyer can be sensitive about their holdings so a banker can write a letter stating that the buyer has funds in excess of the price for the house! You definitely want to verify that either before accepting the offer or put a clause in the contract that the proof of funds must be provided within a handful of days. This is in our standard contract in Arizona so you might ask your agent if there's something there already.

Andrew, start here, because it is the thing almost nobody tells sellers: the Texas contract gives you no proof of funds protection at all. None. The current TREC One to Four Family Residential Contract (Resale), form 20-19 effective July 1, has no paragraph requiring a cash buyer to document funds, no deadline for producing them, and no remedy for you if they never do. Paragraph 4 is Leases. The financing machinery lives in the Third Party Financing Addendum, and on an all-cash deal that addendum is not attached. There is no TREC cash addendum either. So if you want proof of funds, you have to get it before you sign, or have your attorney write it in. Once you have signed, you have lost the leverage. You do have one hook already in the form, and it is a good one. Paragraph 3A says the cash portion of the sales price "does not include proceeds from borrowing of any kind or selling other real property except as disclosed in this contract." If your "cash" buyer is actually funding with hard money or a transactional lender and did not disclose it, that is a contract misrepresentation, not just bad manners. Worth knowing before you take their word for it. What I would require before signing anything: A bank-issued letter on the institution's letterhead, dated within the last 30 days, with a name and phone number I can call. A screenshot or a PDF statement is easier to fake and easier to stale-date. If they will only send a statement, take one no older than 30 to 60 days. The name on the funds must match the buyer name on the contract exactly. If the offer comes from Gulf Coast Holdings LLC and the account is in some individual's name, that is not proof of anything, and I would ask why before I asked anything else. The funds have to be liquid. A retirement account or a brokerage balance is not the same as money that can wire on Tuesday. Now the bigger issue, and honestly this is the real answer to your question. An unsolicited email, cash, no inspections, no documentation is the standard wholesaling pattern. A wholesaler does not intend to buy your house. They intend to tie it up under contract and sell the contract to a third party at a markup, using your property as inventory while it sits off the market. Texas changed the law on this and it protects you specifically. Under Texas Property Code Section 5.0205, effective January 1, 2024, anyone who intends to sell an option or assign an interest in a contract to purchase real property must disclose that in writing to the potential buyer AND to the owner of the property. That is you. And Texas Occupations Code Section 1101.0045 says that doing it without the written disclosure is engaging in real estate brokerage. Doing that without a license in Texas is a Class A misdemeanor, and TREC can assess up to $5,000 per violation with each day counting separately. So ask them one question, by email so you have it in writing: "Are you buying this property yourself, or do you intend to assign the contract?" A legitimate cash buyer answers immediately. Anyone who dodges has told you what you needed to know. And if the answer is that they do intend to assign, Texas law says they owed you that disclosure in writing already. Watch the buyer name line too. If the offer names them "and/or assigns," signing it is your consent to the assignment. You can strike it. A few structural protections, since you asked about not wasting your time: Earnest money and the option fee both go to the title company within three days of the effective date under Paragraph 5, not to you. Paragraph 5A(1) is a blank for additional earnest money on a date you choose. Use it. That is your real seriousness test, because a wholesaler wants to risk as little as possible. The option period is negotiable, including down to nothing. That is the window they can walk for any reason at all. After the option expires, if they cannot close, Paragraph 15 lets you keep the earnest money as liquidated damages or sue for specific performance. That only bites if the earnest money is large enough to matter. One more thing. Selling as-is does not mean an investor is your only option. Investors generally target something like 70 to 85 percent of after repair value minus repairs, and one survey of several hundred investors put the median offer near 67 percent of ARV. That gap is your margin for cleaning it up, listing it, and letting a retail buyer with a conventional loan bid on it. Get a real market opinion before you accept a number that arrived by cold email. I am Zoltan Peresztegi and I work in Los Angeles, the South Bay and on the Palos Verdes Peninsula. I am a real estate professional, not an attorney, and I am not licensed in Texas. Your agent cannot write a custom proof of funds clause into the TREC contract either, because Paragraph 11 restricts that to you or your attorney, so if you want one, a Texas real estate attorney is a one hour, few hundred dollar conversation that could save you two months off market. If you want an introduction to a strong League City or Clear Lake agent to give you a straight read on what the house would bring listed, I am glad to make it at no cost to you. Zoltan

Valid bank statement within the last 30 days and/or proof of funds letter from their financial institution/advisor. Keith Jean-Pierre Managing Principal The Dapper Agents Real Estate Operations in ALL 50 States

I would ask for a copy of their bank statement showing the proof of funds. Or a letter from their financial advisor stating they have enough funds.

Before accepting a cash offer, you should ask the buyer to provide proof of funds showing they have enough liquid assets to complete the purchase. This is typically a recent bank or brokerage statement, a letter from their financial institution verifying available funds, or documentation from the company or entity making the purchase. Sensitive account numbers and personal information can be redacted, but the documentation should clearly show sufficient funds to cover the purchase price and closing costs. It's also a good idea to request a substantial earnest money deposit and verify the buyer's ability to close through your escrow or title company. Taking these steps can help ensure you're dealing with a legitimate cash buyer before taking your home off the market.

It's absolutely reasonable to ask for proof of funds before accepting a cash offer. A serious cash buyer should have no problem providing documentation showing they have the funds available to complete the purchase. Common forms of proof include a recent bank or brokerage statement (with sensitive account numbers redacted), a letter from the financial institution verifying available funds, or documentation from the company providing the funds if it's an investment or hard money purchase. The available balance should comfortably cover the purchase price and expected closing costs. It's also a good idea to verify that the proof of funds is current and matches the name of the buyer or the entity making the offer. If the buyer is purchasing through an LLC, ask for documentation connecting the individual making the offer to that entity. In addition, don't hesitate to request a meaningful earnest money deposit once you're under contract. Combined with valid proof of funds, this helps demonstrate the buyer is committed to closing. If a buyer refuses to provide proof of funds or keeps delaying, that's a red flag. Before taking your home off the market, make sure you've verified they have both the ability and the intent to close. Juan Picos, Realtor

I would absolutely ask for proof of funds before accepting a cash offer. A legitimate cash buyer should have no problem providing documentation showing they have enough liquid assets to complete the purchase. Acceptable proof of funds typically includes a recent bank statement with sufficient available funds (sensitive account information can be redacted), a letter from the buyer’s financial institution confirming the funds are available, or a statement from a money market or brokerage account if those assets will be used for the purchase. It’s also a good idea to make sure the proof of funds matches the name of the buyer or purchasing entity listed on the offer. Even if the buyer is offering to purchase the home as-is with no inspections, I wouldn’t take the property off the market until I’ve reviewed valid proof of funds and have a fully executed purchase agreement. That helps ensure you’re dealing with a serious buyer who has the financial ability to close.

Andrew, before accepting a cash offer, you should require current and verifiable proof that the buyer has enough liquid funds to cover the purchase price and closing costs. Acceptable documentation may include: • A recent bank or brokerage statement • A signed proof-of-funds letter from a recognized financial institution • Written confirmation from a title or escrow company that it has verified the funds The document should be dated within the past 30 days, identify the buyer or purchasing entity, and show an available balance sufficient to complete the transaction. The buyer should redact sensitive account information, but the name, institution, statement date, and available balance should remain visible. Also require a signed contract, a meaningful earnest-money deposit, and a firm closing date before taking your home off the market. Until the funds are independently verified, do not assume the investor is qualified or capable of closing. Have your Texas real estate agent, attorney, or title company independently verify the documentation rather than contacting a bank through a telephone number supplied only by the buyer. Until the investor provides satisfactory and verifiable proof of funds, I would not accept the offer or remove the property from the market.

Andrew, ask for a bank statement or a bank letter dated within the last 30 days, in the buyer's name, showing funds at or above your price. Anything vaguer than that isn't proof. With an unsolicited investor email, I'd be extra careful. PDFs are easy to doctor, so it's fair to want the letter on bank letterhead with someone you can actually call. If the money sits in an LLC, the name on the statement should match the name on the offer. And if the funds are only "available" through a partner or a line of credit, that's financing wearing a cash costume. A serious investor hands this over without fuss. The other real test is earnest money, so ask for a meaningful deposit into escrow before you take the house off the market. I'm licensed in California, so lean on a League City agent for how Texas contracts and title companies usually handle this. Alla Novytska, Realtor®, JohnHart Real Estate, DRE #02254775

Andrew, ask for a recent bank or brokerage statement, or a letter from a recognized financial institution, showing the buyer has enough funds to cover the purchase price and closing costs. They can redact account numbers, but the name, date, institution, and available balance should be visible. I also recommend verifying the proof of funds and requiring a meaningful earnest money deposit before taking your home off the market.