If you have an interest in purchasing Real Estate Owned or short sale properties, then you want to understand the fundamentals of transactional funding and proof of funds letters and how they relate to your property interests and activities. Basically, the transactional funding refers to the funds borrowed for a very short period to transfer a property from the present owner, to the transaction coordinator, then to the new owner. Proof of funds letters are used to help secure financing and clear the way for the estate transactions you are involved in.
The use of transactional funding allows the short sale process to happen smoothly. The basic grounds for the loan is that once the first owner is prepared to sell and the buyer is prepared to take over the property (usually with the standard mortgage ), there’s a short term loan wanted to help the transfer period. This suggests the transactional funding is a loan that exists for some hours, then was recovered when the final property owner pays for the property.
Transactional funding works not just for the short sale eventuality listed above.
When buying property, the buyer must provide some kind of evidence that they have the funds to cover the property acquisition – this is where a proof of funds letter becomes helpful. This document that the investor can use to indicate to the parties involved in a real estate exchange that you have pre-qualified to purchase the genuine estate.
This kind of document is particularly useful if you are involved in short sale transactions and REO purchases that are structured with a double closing or when using transactional funding. They can also be used for other transactions that require documented evidence of your financial resources.
Using this letter, the buyer/investor is able to secure any required extra funding or to reassure the vendor that they have the means to fund the estate purchase.
After you know how these financial opportunities can be employed to the best advantage, you will be on track to achieving economic security thru real estate investment.
Morgan Foreman is a recommended author in the field of foreclosures and short sales. He will show you how to obtain guaranteed transaction funding with no cash or credit needed. Do you need a proof of funds letter? Learn about Proof Of Funds and visit www.WeProvideTheFunds.com
Source by Morgan Foreman