Proof of funds in real estate is a document from a bank or other custodian confirming that a buyer has the money they say they have, as of a stated date. Sellers ask for it before taking a property off the market or opening their books, because it shows whether an offer's cash portion exists. If you search proof of funds real estate, most of what comes back is written for home sales. Commercial buyers can include LLCs and investment funds. SBA borrowers also document their money differently.
What is proof of funds in real estate?
Realtor.com describes a proof of funds letter as naming the account holder and the available balance, on bank letterhead signed by a bank official. Virginia REALTORS' Legal Hotline says verification must come "from a third party in possession of Purchaser's assets."
Wells Fargo's verification page dates the balance to the day the request is processed and does not describe a hold on the money. Kingside Investment Group, a commercial investment firm, calls the letter "a point-in-time capacity check, not a closing guarantee," and notes the buyer "can lose financing, move assets, face another obligation, fail a condition, or choose not to perform." Money is in hand only when escrow receives it; RealOpen notes title or escrow must "receive good funds by wire from an account they can tie to you."
What does a proof-of-funds letter or statement show?
A useful letter or statement shows:
- Issuer: The bank or custodian's name appears on letterhead; Chase says letters are "usually required to be on letterhead" and can take 5–10 business days.
- Account holder: The name should match the buyer on your offer.
- Accessible amount: Chase's "Current Balance Equal to or Greater Than" line can show that the balance meets or exceeds a stated amount.
- Date: The bank states the balance as of a specific day.
- Authorization: The account holder authorizes the release; Chase requires one completed within 90 days.
- Signature and contact: A bank official signs the letter and lists contact information.
Wisconsin REALTORS® lists the common defects: a letter not from a financial institution, funds belonging to a company, a reference to a potential loan, or funds not available to the buyer.
Proof of funds versus prequalification, preapproval and financing commitments
Proof of funds documents equity the buyer already holds; prequalification and preapproval letters describe early stages of borrowing, while commitment letters describe a later stage. None of these letters is cash.
For home loans, the CFPB says prequalification and preapproval letters "are not guaranteed loan offers." Hackett Feinberg describes a commercial term sheet as "ordinarily not intended to legally bind or commit a lender to making a loan," while a commitment letter is "intended to be a binding commitment to lend, provided certain conditions precedent are met." An ABA analysis notes the lender's obligation "never arises until the borrower performs or meets all conditions to the letter." Commercial loan commitments commonly condition funding on an appraisal, a Phase I environmental report, title and survey, and credit committee approval.
You may want to ask how much of the price is the buyer's own cash and how much is borrowed. Also ask whether they expect you to carry a seller note.
What should a seller or broker check?
Compare the document against the offer:
- Consistency with the offer: The verified amount should cover the deposit and the equity portion. It should also cover closing costs.
- Purchasing entity: Direct Private Capital Group, a commercial finance firm, says the account holder "should match the borrower, guarantor, purchasing entity, or documented contributor."
- Source of equity: Ask whether the equity is personal cash or a fund's capital. If it is investor money, ask whether it has been collected. Crowdfund Lawyer, a practitioner source, distinguishes a soft circle, which is non-binding and not escrowed, from a hard commitment, a signed subscription agreement with wired funds.
- Timing and conditions: Ask when the money becomes available and what must happen first, such as a lender appraisal or another investor's approval. Morgan Lewis describes fund capital-call notice as commonly 10 business days.
When to request it and how to protect sensitive information
It is reasonable to ask for proof of funds once an offer or letter of intent puts a price in writing. One agent quoted by Realtor.com says delivery "usually within a 24- to 38-hour time frame" after acceptance is fine in a home sale. Handing three years of books and a guest list to someone you met last month is a big step.
Then verify it:
- Find the bank's number yourself. Akron Cleveland Realtors advises confirming proof of funds "directly with the issuing financial institution using publicly available contact information." Don't call the number on the letter. The Houston Association of Realtors warns that "you could be calling an accomplice."
- Confirm the name with the bank, then check the amount and date. The buyer may need to authorize the call.
In one Scioto County, Ohio case, a letter claimed $692,678.93 at U.S. Bank. The bank manager said the bank does not use that letterhead and her signature was forged.
The FTC's guide for businesses says "Regular email is not a secure method for sending sensitive data." Ask the buyer to upload it through the title or escrow company's secure portal or another encrypted tool. Limit who sees it to you and your advisor. The same FTC guide advises keeping only what you need. Realtor.com says buyers can black out "sensitive information on the statement," so a redacted copy is usually fine.
What proof of funds should an RV park seller ask for?
Match the request to the buyer's payment plan. The four examples below are hypothetical.
Cash offer
Suppose a buyer offers all cash for your 90-site park. Ask for a bank letter or statement in the name of the entity on the offer, dated within the past few weeks, covering the full price plus closing costs. Then ask what "cash" means; the North Carolina REALTORS® manual tells agents to "Define the client's use of the term 'cash.'"
Investor-backed LLC
Suppose the buyer is an LLC formed last month and says a fund will contribute the equity. Ask for the fund's written commitment to that specific entity and confirm who can sign it. Ask whether the investors' money is collected or soft-circled. Montague Law, writing from practice, describes a shell buyer as possibly "a Delaware vehicle formed the previous Tuesday, capitalized with exactly one hundred dollars." You can ask for a personal guaranty from the principals or a larger deposit. A stalled buyer also leaves your staff and returning seasonal guests unsure about next year.
SBA-financed buyer
Suppose the buyer plans an SBA 7(a) loan. Lender and law-firm commentary on SBA's SOP 50 10 8.1, effective October 1, 2026, describes a 10% equity injection for an initial acquisition; confirm the current requirement with the lender. Proof of funds should cover that injection plus closing costs; the rest depends on the lender's conditions and SBA eligibility. The SOP language makes RV parks and campgrounds eligible "if more than 50% of the business's revenue for the prior year is derived from transients who stay for 30 days or less at a time." If transient stays of 30 days or less were not more than half of prior-year revenue, the park may fail that test, and confirming the buyer's balance will not change that.
Family member or longtime manager
Suppose your daughter or the manager who has run the store for a decade wants to buy with an SBA loan and a note you carry. Proof of funds still covers only their equity and closing costs. With an SBA loan, a seller note may have to be subordinated and, if it counts toward the buyer's equity, sit on full standby with no payments during the SBA loan term. Ask your attorney and the lender how the note would be structured and secured; the same document requests apply to someone you know well.
Why proof of funds does not settle every transaction risk
After the balance checks out, diligence, title, contract terms and lender conditions remain, and campground sales often slow there:
- Woodall's Campground Magazine reported broker Richard J. O'Brien in 2024 describing "buyers needing extensions to close and financing contingencies common in most purchase contracts."
- RV Park World, a practitioner guide, puts a typical earnest money deposit at 1–2% of purchase price and diligence at 45–60 days minimum, or 75–90 days with septic or environmental concerns, or when multiple parcels are involved.
- The Michigan Bar Journal notes the deposit usually becomes non-refundable only after the diligence period ends.
- A title commitment is an offer to insure only once its listed requirements are met, and title objections and cures run on their own timeline.
You do not need to resolve a deferred septic repair before a first conversation. A financed buyer's lender will likely want it inspected and may attach conditions. When Silver Creek, a Louisiana RV park, went to auction, the original bidder could not complete the purchase; Modern Campground reported a new investor closed in March 2026 using a $1.6M bridge loan.
FAQ
A bank letter or statement can document available funds, but financing conditions still need a separate check. The answers below also cover redaction and when to request proof or refresh an outdated letter.
Is a bank letter better than a bank statement?
Either can work if it comes from the institution holding the money. In practice, a signed letter is easier to confirm with the bank, and a recent statement may show whether the balance has been steady.
What if the buyer is financing most of the price?
Ask for the lender's list of conditions and expected closing date. RV Park World says LOI to close typically runs 90–120 days.
Can the buyer redact account numbers?
Yes.
What if the letter is a few months old?
Ask for a fresh one. AmeriSave says letters are "usually" good for 30 to 60 days, and park closings run longer, so a second request near closing is reasonable.
Do I need proof of funds before a first conversation?
- It is reasonable to wait until a price is in writing, in an offer or letter of intent.
Exploring a park sale
Dirt Ventures acquires and operates RV parks and campgrounds, and our process begins with A Conversation, in Three Steps: we learn about your park and discuss what matters to you. Then we explore whether there is a mutual fit. If you are beginning to think about what comes next for your park, Start a Conversation. You do not need the timing, structure, complete records or a broker figured out to begin. If email is easier, write to George at george@dirt.ventures and tell us a little about your park.