Proof of funds for a cash buy

pxg638

Hi there, first time post, so be gentle! Did have a quick search for this on your forums, and was still a little confused, so apologies if this is a rehash of something recent.

My sister is in the lucky position of being able to pay cash for her house (in England, just to be clear). She has seen the one she wants, has put in an offer and the agent has said the seller will not consider the offer until they have seen proof of funds available. Funnily enough, she does not have all that in one place, it is in numerous bank accounts, shares etc.

She is uncomfortable with the idea of some random yahoo seeing all this detail, not least of which it would show she could offer more than she is offering! Seeing how the money is all over the place, we she cannot get a letter from the bank manager to assure that. So my queries are as follows:

What is the legal position here? Money laundering aside, I cannot see what business this is of the vendor as no contract has been entered into at this point, and once it has been, there is recourse through the courts anyhow, no? This feels like some game of 'show me yours and I'll show you mine'.

What right does the seller or their agent have to this information and what protection is in place that they use it appropriately?

Is a letter from a solicitor stating 'funds in the amount of £x are available' sufficient, and would a solicitor actually even do that?

Any thoughts on this issue gratefully received!

Pete

JanCee

This is standard practice and nothing to get stressed about, I had to do this myself once on a house purchase, I just took some statements in to the vendor's EA.

I also know someone who was strung along on the sale of a very expensive house by a "cash" buyer who turned out to be a walter mitty character with zero cash in the bank. It cost them dearly as they only found out after they had signed up to a 6 month rental on another property. Believe me they wished that their EA had insisted on proof of the cash offer.

jimjames

As long as what is shown demonstrates the purchase can be afforded without a mortgage you don't need to show any additional statements that show funds in excess of that.

A solicitor would provide such a letter if required but it seems a waste of money paying to do that when you could just show the statements.

ognum

Yes, I have always had to do this and they are used to the funds being all over the place, just take in all the proof. I would not sell to anyone without proof of funds. That is what the mortgage company gives you if you have a mortgage.

flora48

I would always want proof of funds after my 'cash' buyer lost his buyer. It cost us a lot of time and money.

PasturesNew

Get it all out in cash, put it into a suitcase, go to the EAs office and pour it onto the floor and insist they sit in the middle of the floor and count it with you

They'll then know you're a raving loon, but do have the cash - and they won't make any further requests from you, but will expedite the purchase in order to be well rid of you.

jimjames

PasturesNew wrote: »

Get it all out in cash, put it into a suitcase, go to the EAs office and pour it onto the floor and insist they sit in the middle of the floor and count it with you

They'll then know you're a raving loon, but do have the cash - and they won't make any further requests from you, but will expedite the purchase in order to be well rid of you.

Or take the first portion of £100 in 1p pieces for them to count, sure they'll be bored by the first bag!!

betsie

we had to do this, just take enough bank statements/share cert etc in to show proof of the bulk of the funds. They do not have to keep copies, just have a look to see you are not bluffing.

taxsaver

Personally I wouldn't do it. I'd say my offer is what it is - take it or leave it and if you don't want it then I'll take my cash to another property!

greatgimpo

taxsaver wrote: »

Personally I wouldn't do it. I'd say my offer is what it is - take it or leave it and if you don't want it then I'll take my cash to another property!

Personally, I wouldn't accept your offer. The seller has a lot riding on your "yes I can afford it, but I won't prove it".

taxsaver

Then fine it'd be your loss! :rotfl: The buyer also 'has a lot riding on it'.

I have been a cash buyer on many occasions and have NEVER been asked to prove it. I think it's intrusive.

Furthermore a non-cash buyer is not able to prove that they WILL get a mortgage offer before an offer is accepted - please don't refer to AIP certs. as they are not worth the paper they are written on!