Requesting Proof of Funds

74 replies [Last post]
Offline
Joined:
01/12/2013

I have two "interested" parties now in my B&B.  Both have come for a showing, I've spent about an hour with each.  One has booked a couple of rooms for a week from now, so she can get a second look and discuss it with her family who is joining her on her stay.  I've no doubt that she is going to ask for financial info, and so my realtor has already advised her to send her pre-qualification letter and non disclosure statement ahead of her stay. 

The other party is now asking for financial information (without a second showing), but claims he would be paying cash and doesn't have a pre-qual letter.  When asking him for proof of funds, what exactly am I requesting?  A bank letterhead monthly statement showing his funds, or ?

egoodell's picture
Offline
Joined:
06/01/2008

GOOD LUCK!!

__________________

Riki Goodell
Arcady Vineyard Bed & Breakfast
Arcady Vineyard Wine Tours
www.arcadyvineyard.com
Come! Let us show you the beautiful Monticello Appellation!

 

Offline
Joined:
01/12/2013

INSPECTIONS TODAY!  Ugh - so nervous!  I still can't believe this is happening!

Breakfast Diva's picture
Offline
Joined:
05/26/2009

Very exciting and nerve wracking. Whatever they find (and they will find things) would need to be fixed anyway. Don't sweat the small stuff and the big stuff, let them take off the selling price. I say this from experience. When we had our inspection, they found that one of our four septic tanks needed to be replaced. The appropriate amount of funds came off the selling price. What we didn't figure was how disruptive and complicated it was to do on our specific property. They knew though!

As an owner, you know how certain repairs/fixes will not be able to be done with guests around. They don't really know this yet. You have to figure in the lack of funds while those things are being done. Let them do it if there is something major!

Generic's picture
Offline
Joined:
02/24/2011

It's one of these things where you have no control over it. So just relax, because worrying about it won't do a single thing to change the outcome.

__________________

Permission to quote in whole or in part, other than usage on this forum, is entirely forbidden.

 

Offline
Joined:
10/07/2008

I hope it all runs its course and you are free soon! (Then you can come visit all your innmates) smiley

__________________

Gluten free is never free. - Joey Bloggs

 

gillumhouse's picture
Offline
Joined:
05/22/2008

YIPPEE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

seashanty's picture
Offline
Joined:
06/02/2008

 oooh good!  here's hoping! 

Offline
Joined:
05/22/2008

you missed her other thread. she has an official offer now. waiting on inspections.

Breakfast Diva's picture
Offline
Joined:
05/26/2009

Wonderful! So quickly it happened for you. It gives me hope for the day I list.

I hope they have good luck with financing too!

Offline
Joined:
05/22/2008

Start planting those statues in the yard Smiling

Offline
Joined:
01/12/2013

EmptyNest wrote:

Start planting those statues in the yard Smiling

Yes, BD...plant those statues (upside down!) and have someone come in and bless your house.  My Catholic neighbor did it for me.  She has been in the house once or twice before, but didn't really know the layout or how things were set up.  She walked throughout the entire house, blessing as she went, and when I opened the door to my quarters, she literally took a step back and said "Whoa".  LOL.  Apparently the energy in here was not good, which makes sense.  But it's all good now!  So yes...statues, and blessings and prayers and a good realtor! One that knows what the freak they're doing...that's all good Smiling

 

I also am amazed at how quickly it happened.  Things are really picking up in this area, so that helps, for sure.  They are putting well over half down, and based on other information they've shared, I've no doubt the financing will not be an issue.  The inspection I am a bit worried about.  It's an old house, and there's just no telling what may come up.

Breakfast Diva's picture
Offline
Joined:
05/26/2009

We're not for sale yet, but hopefully in the next couple of years. There are so many b&bs for sale in our region and state. Kind of scary. But, as we all say here, we're all so different. You just have to find the right person for your place.

Madeleine's picture
Offline
Joined:
09/29/2011

Everything in my town has sold. Don't know if it's better to be the only place for sale or to have other places to compare. Still have a couple of years.

__________________

Everyday, for good or ill, we intersect with some else's story and become a part of it.

 

Offline
Joined:
06/24/2008

Continuing with the fingers and toes crossed. 

Great news!  Great! Great!

egoodell's picture
Offline
Joined:
06/01/2008

Good for you! Was it the one that came with their family or the one that would not submit financials??

 

Offline
Joined:
01/12/2013

egoodell wrote:

Good for you! Was it the one that came with their family or the one that would not submit financials??

Actually, it was neither.  The family one was more interested in a lease (gaaaa! NO!) and the other - well...their loss! 

happykeeper's picture
Offline
Joined:
12/11/2008

Got to love it. Awaiting the inspection. angel

__________________

Take a leap.... and a net will appear

 

Offline
Joined:
01/12/2013

I now have a contract on the inn, after a little negotiation.  I won't relax until after the inspection, but this feels right.  So nervous.  So scared.  So excited!

Offline
Joined:
05/30/2008

Exciting!  Hope it turns out just as you wish! 

__________________

People don't notice whether it's winter or summer when they're happy.
~ Anton Chekhov

 

Madeleine's picture
Offline
Joined:
09/29/2011

Yippee!

Silverspoon's picture
Offline
Joined:
10/16/2011

Fabulous news!   Keep us posted. yes

__________________

Gardens are not made by singing "Oh, how beautiful" and sitting in the shade.
Rudyard Kipling (1865-1936)

 

Offline
Joined:
05/22/2008

WOW..wonderful! Hope you got close to what you wanted Smiling

Breakfast Diva's picture
Offline
Joined:
05/26/2009

That's fantastic! We'll be hoping all goes smoothly.

Offline
Joined:
04/21/2010

Most recent bank statement, brokerage statement will do. Be aware that most people don't have this type of money laying around in a savings account so you might get more then one statement as they would have to close out investments and pool up the funds. 

Offline
Joined:
01/12/2013

I shouldn't curse it by sharing so soon, but I have to share that I have an offer on my inn Smiling  I'll keep y'all updated.  Thank you for all the advice and positive ju ju the last several months.  heart

gillumhouse's picture
Offline
Joined:
05/22/2008

If it can be crossed, I crossed it.

Offline
Joined:
06/24/2008

BananaE29 wrote:

I shouldn't curse it by sharing so soon, but I have to share that I have an offer on my inn Smiling  I'll keep y'all updated.  Thank you for all the advice and positive ju ju the last several months.  heart

keeping fingers and toes crossed. 

Madeleine's picture
Offline
Joined:
09/29/2011

Smiling

seashanty's picture
Offline
Joined:
06/02/2008

 it must be so stressful for everyone!

i've been looking at buying a property with a friend recently (correction, he is buying a property, i'm just along for the ride) and the very first thing he is being asked before anyone will show him the house is 'how much are you pre-qualified for' and this is for residential, not a b&b. not only pre-qualified but pre-approved. he carries around his pre-approval letters as the realtors and private sellers are asking for copies. 

Offline
Joined:
05/22/2008

Yes and Yes. If  you don't...as banana says...nothing but looky loos who have a fantasy but when it comes right down to it...SHOW ME THE MONEY! And I'll show you what I have Smiling

Offline
Joined:
10/07/2008

"We are serious buyers"

in 5 years time.

It is what it is. As mentioned if someone falls in love with it they may do whatever it takes to acquire their dream now. Many of us did this.

Skamokawa's picture
Offline
Joined:
08/24/2008

The first place we seriously looked at, we just couldn't get a financing package together that I was comfortable with.  The sellers got to the point of "Make us any offer", but even at that point, it wasn't just acquiring the place, it was the renovation costs that we just couldn't make work in a realistic way (as in: in this lifetime).  It did eventually sell, and the new owners were operating it with a new website, the renovations had begun, but one night the place went up in flames.  No one hurt, but absolute loss.  The building had been a hotel since before the Olympic National Park was made a Nat'l Park.  (in a small town nearby).  So sad to see these old places go.  Five years later, we were so much more ready, and the right place did present itself.  Still another 8 years before it could be opened though.  And 5 years ago completely paid off.

p.s.  We installed sprinklers.

 

__________________

Twin Gables Inn
On the Lower Columbia Water Trail

 

Offline
Joined:
01/12/2013

Oh my gosh, that is so heart breaking.  I cannot imagine.   Sad

happykeeper's picture
Offline
Joined:
12/11/2008

Whatever it takes? That should include being up front about their financials, even if they are a stitch short of sewing up a deal. It would drive me crazy to have a realtor bring a lookie lou without honoring a basic request to get their financials.

Of course, every situation is different and each owner has to decide for themselves, but I would struggle with the emotions of having a non-buying Snoop Dog sniffing around our place.

Offline
Joined:
10/07/2008

So...this is my take.

You will go around the wringer on this with potential buyers. Some will say they are really interested, and really have three years til they acquire their dream.

One couple told us recently that they have good credit. Ok.

Another said they have a good down payment ($20K is not a good down payment for a business and financing the rest).

We are told we are not viable. We are told we are a lifestyle B&B. 

The B&B Brokers will obviously try to get aspirings to go big, to get the financing required. To get that financing required, the B&B has to support itself. The B&B Brokers will NOT tell them to buy a lifestyle B&B, and in fact if they want a lifestyle B&B (meaning 5 rooms or less) they will convince them it is foolish.

Back to B&B Brokers:

One mentioned was contacted after our PO's sold us a bill of goods, they literally falsified the numbers. They said and I quote "We are not held responsible for that" only the selling and buying of the inn. This is why I say here all the time to aspirings "Do not trust innkeepers" get everything in writing.

Now to Banana... If someone falls in love with your place and they cannot get it out of their minds (which is what I hope will happen here) they will work out a way to buy it. Don't stifle that by requiring proof of funds. Good luck with that (as you have seen already it won't happen - unless they have hired a B&B broker to represent them, and have all that worked out in advance, THEN you will have proof).

So for what it is worth. You will spin your wheels, get your hopes up, get frustrated and pray a buyer falls in love and buys their dream B&B.

 Background: We had a couple who were the perfect fit for this B&B. She even played bluegrass music. They were convinced by their consultant/brokers in Vermont that we were not viable and to walk away. They bought an innmates place, and the place is too much for them. We knew that, they knew that. We are happy the innmates were able to cut the apron strings! So red rover red rover send em on over, you never know. Smiling  I wish you all the best in this, I know where you are (mentally, emotionally, physically)

Offline
Joined:
01/12/2013

Thanks for your input JB.  I did not expect to have any interest this soon, but since I do, I just want to do this right and not waste a lot of time with the dreamers and looky-loos.  Everyone here, and I mean everyone, told me from the get go (way back in October when I was only throwing the idea around) to request a pre-qualifying letter from anyone wanting my financial info.  So I've stuck with that, and will continue to do so, because it makes sense to me.  My realtor didn't understand this, and questioned me every time I spoke of it, and sent me two lookers without it, and amongst many other things she did to irritate me, she told me I lost this buyer because I asked for something that I asked for from the very beginning!  I'm still so pi$$ed off that she said this to me and I have no regrets about terminating my contract with her.  I would never, ever, expect to be able to ask someone something so personal about their life (meaning their income), and not expect to share my info also. 

So when you say "don't stifle...by requiring proof of funds"...I am really confused.  Are you sharing your financials without it?

Offline
Joined:
10/07/2008

BananaE29 wrote:

So when you say "don't stifle...by requiring proof of funds"...I am really confused.  Are you sharing your financials without it?

Yes.

If someone seems interested enough we are sharing the whole enchilada. It is what it is, now take this from someone who has not sold the place, for what it's worth!

Haps, I know, the term I used it one that is thrown at us from the B&B brokers, that is why I was using it repeatedly to shore up my point on this. Sell it yourself, don't trust those brokers as far as you can throw them. Yes, they are here reading this youbetchya.

Thanks for the positive twist, as always. I am twisting and shouting it. Smiling

happykeeper's picture
Offline
Joined:
12/11/2008

Honestly JB - it sounds like you have, "viable" stuck in your throat. If I was a Doctor, I would recommend a viablectomy. If I was a plumber, I would recommend viaflush. If I was a lawyer, I would recommend we sue viable for misrepresentation.

I am none of those things. I am a knucklehead and I say you need to get that word into your positive spin as soon as you can.

"Let this ? bedroom bed and breakfast make your dream lifestyle viable." (syn: possible)

"A viable alternative to life in the city" (syn: worthwhile)

just sayin' Blanche

seashanty's picture
Offline
Joined:
06/02/2008

 i took an aspiring innkeeper course with these folks way back ... and they gave me such solid advice, i will be forever grateful. they are in the business of selling b&bs it might be worth contacting them about selling your place.   bbteam dot com

Offline
Joined:
10/07/2008

I would disagree.

Offline
Joined:
01/12/2013

Thank you SS - I'll look into them

Offline
Joined:
01/12/2013

I am so exhausted from dealing with my realtor that I've drafted a letter (not sent yet) terminating our contract.  Selling your home and your business is stressful enough, but I am finding myself more upset with the realtor's actions, or lack thereof, than anything else.  I am basically holding her hand through this process -  finding disclosure statements on line for her to supply buyers with (because their office has never used one!), repeating to her that I need pre-qualified parties before I release info (seriously have told her this at LEAST four times), and now she's questioning why I need these things, because well "No other business transaction that I've handled have ever requested these things".  WTH?!?!  This person is one of the top three realtors in the city.  And their office is very well known.  It's crazy scary how informal things are done around here.

I'm at my wit's end.  I am a bit worried about scaring off the one prospective buyer that booked a couple of rooms for next week, but I can't keep dealing with this realtor.  My plan is to phone her after firing the realtor and to let her know that I am no longer represented.  I know there is a 30 day waiting period before I can sell to her without having to pay the realtor the commission, but I'm more worried about making her nervous and scaring her off. 

Edited: The buyer that said he had cash and was told I needed a notarized statement from his bank stating same will not provide a letter as he claims his funds are tied up in stocks and bonds.  So be it.  Adios.

happykeeper's picture
Offline
Joined:
12/11/2008

As we are putting together our 5 year exit plan, one of the questions I have had is whether there is any value in working with a national seller that specializes in inns and B&Bs. Did you do any looking at this concept before you went in the direction you went? I have found that there are a couple of on island realtors that work in niche markets. Do you think your area has anyone like that? I need to educate myself about this. Any thoughts you have would be appreciated.

 

Offline
Joined:
01/12/2013

I spent a little time looking at national B&B brokers or consultants, but I guess I was trying to be quick and cheap about it.  There are no local realtors here that specialize in niche markets, and apparently there are none that specialize in commercial transactions!  My thought when going with local (and someone I thought knew how to handle business sales) was that I wouldn't have to deal with the curious and the dreamers.  I thought she would screen them for me and when told what I needed, be able to do it.  She is not. 

I'm not real sure what my next step is, so I haven't thought much about going back to a national broker/consultant.  I think you are smart to consider it.

happykeeper's picture
Offline
Joined:
12/11/2008

Did you find a national concept was more expensive?

Our location impacts us- being in the big blue. That's what got me thinking about a hybrid type niche realtor who would know how to handle the business sale as well as have a semi-local presence. It makes me wonder who amongst us actually used a national type to buy a property? We definitely don't want to end up being somebody's tax write off for a trip to pair o dice. 

On a different note: We did sell our previous house on our own and it worked out fine. I often think I might actually be able to put us out there in a way that perhaps only an innkeeper or an broker who knows inn-keeping could do and then invite buyer reps to their half of the commission, perhaps with them handling the paperwork. HA! It sounds so easy when you talk about it. It is obviously much tougher when you are in the middle of it. I'm sure you'll find the right direction. Did I miss what happened to the first person? Are they still interested? Are you firing before that plays out?

Offline
Joined:
01/12/2013

happykeeper wrote:

 Did I miss what happened to the first person? Are they still interested? Are you firing before that plays out?

Their response to a request for a notarized letter from their bank was that their funds were tied up in stocks and bonds and they had no plans to liquidize until they decide to proceed. They went on to say that they were looking at two other B&Bs and those sellers had no problem releasing financial information with only a non disclosure statement.  They also responded that if that were an issue for me, they were not able to move forward.  The realtor responded back that I still wanted a statement or notarized letter of some sort.  That was around noon today, and I haven't heard anything yet.
 

When my realtor told me of this response, I stuck to my guns and said I still wanted something that showed they could afford this property.  Her response?  "Well, you probably just lost this sale then".  You have no idea how badly I wanted to say "Well, you just lost your client."  She has questioned everything I'm asking for, yet continually says "I just want to do what you want me to do."  Really?  Then why am I repeating it every freaking time we get a new inquiry? 

I still haven't sent the email to her.  It's just sitting on the computer staring at me while I make 100% sure this is what I want to do.

Offline
Joined:
01/12/2013

Email has been sent notifying her that I wish to terminate our contract.  Ugh.  I hate this. I hate dealing with anything that brings about bad feelings, but I am just so frustrated.

Breakfast Diva's picture
Offline
Joined:
05/26/2009

How about a certified letter from their accountant? The accountant knows where all the money is over multiple banks and investments.

So, they are looking at the financials of 2 other B&Bs? I think your gut feeling is right. How serious can this guy be if you're just one of many in the running? Next it's going to be him trying to pit the price of one property against the other.

Offline
Joined:
01/12/2013

Breakfast Diva wrote:

So, they are looking at the financials of 2 other B&Bs? I think your gut feeling is right. How serious can this guy be if you're just one of many in the running? Next it's going to be him trying to pit the price of one property against the other.

And one of them is in this same town, is two times the size and two times the price.  With two times as much needed maintenance that has been deferred for years, a bad reputation, and really shoddy marketing.  This prospective buyer does not know what he wants, and has not done his homework, in my opinion.   I enjoyed talking with them, they were nice people, but they are barely past the "dreamer" stage.

happykeeper's picture
Offline
Joined:
12/11/2008

It does sound like a dilemma and I am not sure what we would do if we were in the middle of it. I think given what our place would cost, I would just expect that a serious buyer would be able to provide a qualifying sheet. Wouldn't that include these stocks and bonds? Wouldn't a bank pre-qualify them? I guess, not being where you are, makes it kind hard to understand in the little big picture.

Having said all my qualifying double talk, I just can't see us disclosing our business financials without both a non-disclosure statement and pre-qualifying sheet.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.