Active discussions

Meet the Other Phone. Flexible and made to last.

Meet the Other Phone.
Flexible and made to last.

Buy now

Please or to access all these features

Talk
Property/DIY

Join our Property forum for renovation, DIY, and house selling advice.

Original poster

How to show proof of funds if only a cash buyer upon your own sale??

59 replies

BelleBoyd · 27/01/2023 14:17

This really. EA asking for proof of funds. My property is under offer and I own outright. It’s sale covers the purchase price but how do I prove all that? Is it a case of providing my solicitors details who can confirm? Have done that. Can they confirm? Didn’t expect this as haven’t conveyanced for a long time and don’t remember being asked this before. (Was a cash buyer previously also)..

OP posts:
RooBear9 · 27/01/2023 14:21

You're not a "cash buyer" then are you? You purchasing the property is dependent on the sale of another property. Obviously yes, your solicitor can confirm you have a sale agreed but you are not a cash buyer if you don't have the cash sitting in the bank.

FlounderingFruitcake · 27/01/2023 14:22

You’re not a cash buyer. That means cash in the bank.

GoodChat · 27/01/2023 14:23

Yeah you're a cash buyer when you've sold. At the moment you can't buy a house.

Overthebow · 27/01/2023 14:23

Yes I thought cash buyer meant cash in bank. Isn’t that why sellers like cash buyers, as they don’t have a chain? You have a chain so if your sale falls through so does your purchase.

OldFashionedWomen · 27/01/2023 14:23

A cash buyer has liquid assets. It's not contingent on a sale.

You'll be a mortgage free buyer. Is that why you mean? Confused

Ihavekids · 27/01/2023 14:24

You're part of a chain and not a cash buyer. I'd make this clear asap as the seller needs this info. No point trying to prove otherwise.

Original poster
BelleBoyd · 27/01/2023 14:31

No a cash buyer is a mortgage free buyer not just having the cash at that moment but using cash not mortgage to buy. EA wants a mortgage agreed doc whereas I obviously don’t have one or proof of funds. Bought last property over 10 years same situation but wasn’t asked for proof of funds. Maybe this a relatively new to ask?

OP posts:
Original poster
BelleBoyd · 27/01/2023 14:32

Have obviously made all this perfectly clear to EA and to the seller. Not hiding anything

OP posts:
worried4698643 · 27/01/2023 14:33

BelleBoyd · 27/01/2023 14:31

No a cash buyer is a mortgage free buyer not just having the cash at that moment but using cash not mortgage to buy. EA wants a mortgage agreed doc whereas I obviously don’t have one or proof of funds. Bought last property over 10 years same situation but wasn’t asked for proof of funds. Maybe this a relatively new to ask?

Then you have mislead the sellers. You are not a cash buyer. They check funds because lots of people (like you) say they are cash buyers and are not.

The attraction to selling to cash buyers are you are not relying on them as a link in the chain.

redspottedmug · 27/01/2023 14:34

Sorry you're not a cash buyer and if you've ticked a box somewhere that was incorrect.

We sold and bought last year without a mortgage and I believe the expression was 'funds dependent on sale of property' or something like that.

Pootles34 · 27/01/2023 14:34

No not a cash buyer - the estate agent should have explained this to you.

GoodChat · 27/01/2023 14:35

BelleBoyd · 27/01/2023 14:31

No a cash buyer is a mortgage free buyer not just having the cash at that moment but using cash not mortgage to buy. EA wants a mortgage agreed doc whereas I obviously don’t have one or proof of funds. Bought last property over 10 years same situation but wasn’t asked for proof of funds. Maybe this a relatively new to ask?

They ask because people say they're cash buyers when they're not.

You'll always favour a cash buyer because they can move fast. It's the whole point - there being no chain. You have a chain.

thunderouslug · 27/01/2023 14:37

I am in the same situation and just told the EA that we don't need a mortgage. Pretty sure they themselves referred to us as cash buyers. Our proof of funds was just the memorandum of sale of our current house.

Itsonlyagame · 27/01/2023 14:37

Show them your paperwork from the property that is under offer?

Original poster
BelleBoyd · 27/01/2023 14:37

Aargh I have said to them I’m in a chain! Have told EA and seller I’m in a chain! I was asking what proof of funds to give when asked. Never mind.

OP posts:
BernadetteRostankowskiWolowitz · 27/01/2023 14:39

hoa.org.uk/advice/guides-for-homeowners/i-am-buying/what-is-a-cash-buyer/

Home Owners Alliance disagrees with you OP.

They say specifically

However, the definition of what is a cash buyer is often misunderstood. A cash buyer must have the money available to purchase the property when making an offer and not rely on money from selling another property

thunderouslug · 27/01/2023 14:40

@BelleBoyd Sorry people immediately jumped on you about the cash buyer thing. Seems like a sensitive subject but wasn't really what you were asking about. In any case, you have been transparent, so nothing to worry about. Just ask them if the memorandum of sale from your house is enough for proof of funds. The EA who is selling your house should be able to provide that if they haven't already.

BernadetteRostankowskiWolowitz · 27/01/2023 14:40

BelleBoyd · 27/01/2023 14:37

Aargh I have said to them I’m in a chain! Have told EA and seller I’m in a chain! I was asking what proof of funds to give when asked. Never mind.

You can still be in a chain and have the full funds in cash (in addition to what you would sell your home for).

This is what they are asking for.

maximist · 27/01/2023 14:40

I was in your position six years ago, I provided the EA for my purchase with a copy of my memorandum of sale for the house I was selling, and they were happy with that. Presumably they can check with the Land Registry that there's no mortgage outstanding if they want to double check.

And both sets of agents referred to me as a cash buyer throughout....

GoodChat · 27/01/2023 14:40

BelleBoyd · 27/01/2023 14:37

Aargh I have said to them I’m in a chain! Have told EA and seller I’m in a chain! I was asking what proof of funds to give when asked. Never mind.

You can show them the memorandum of sale for your house.

WoolyMammoth55 · 27/01/2023 14:46

Hi OP, not trying to be unhelpful or annoy you - however it does seem like there might be crossed wires if you've been asked for proof of funds.

When we were cash buyers (living in rented after sale had completed) we had to give bank statements showing the cash sitting in our account, as 'proof of funds'.

So my concern would be that if they have understood that you are a mortgage free buyer with funds dependent on sale of your current property, then it's a weird thing for them to ask for?

But perhaps they just want the memorandum of sale. Best of luck.

BloodAndFire · 27/01/2023 14:52

You can't show proof of funds. Because you don't have the funds.

You are not a cash buyer.

I am not a lawyer, but they are:

A cash buyer is someone who can finance their purchase without a mortgage or selling their own home. Technically, to be a cash buyer, you must have enough money available to buy the property at the time you make the offer. For example, you may have already sold your former home and be renting in order to be able to act quickly in a fast-moving market.

www.kww.co.uk/2022/10/14/cash-buyers-for-houses-what-it-really-means/#:~:text=A%20cash%20buyer%20is%20someone,time%20you%20make%20the%20offer.

Comefromaway · 27/01/2023 15:00

A cash buyer is not a mortgage free buyer. A cash buyer is not part of a chain. You will be a cash buyer once your property is sold and the cash is in the bank.

FlounderingFruitcake · 27/01/2023 15:04

A cash buyer and a mortgage free buyer really aren’t the same thing but you can use the memorandum of sale as your proof of funds.

If EA has asked for anything relating to a mortgage then I’d assume that’s just standard copy/paste wording and would remind them that you don’t require a mortgage to fund the purchase.

CrotchetyQuaver · 27/01/2023 15:13

Your situation is that you will fund the purchase of the new house from the sale proceeds of your existing one without requiring a mortgage.

Not a cash buyer for the reasons stated by so many already on this post.