Don't Be Insulted if You're Asked to Demonstrate Proof of FundsDecember 2, 2017
With low inventory, more and more Boston luxury real estate buyers are making offers with no financing contingency. Although, some of these buyers may still be financing the home purchase, they are confident enough that they don’t need to make the offer contingent on financing.
There have been a handful of cases where Boston luxury homes buyers were unable to execute their contracts. This is enough to make some sellers leery of cash offers and therefore, most insist on a “proof of funds” statement from a financial institution.
It’s a legitimate demand or requirement to prove sufficient funds. But, at the same time, it makes some cash buyers somewhat upset and insulted that they are paying cash for Boston luxury real estate and still have to prove they have the funds. I tell my clients that it’s nothing personal - it is a business transaction and to ask for proof of funds is not unusual. An exception may be a prominent public or financial figure whose income is public knowledge. As it is customary for a high priced luxury rentals, once an application is submitted, a credit check is imminent.
More often than not, I have been confronted with a situation when my cash buyer client was asked for proof of funds, and he was so insulted that he almost back away from the deal. It took some time to explain to the Boston luxury homes buyer that it was standard procedure and not to take it personally.
Real estate is full of these nuances, and not all the buyers in the marketplace understand how to navigate the process. It takes some patience and a fair amount of experience to walk buyers though the Boston luxury homes purchase process. I’m always here to help if you’re thinking about your next move.