When you’re preparing to enter into a contract to buy a home, you will probably have to give the seller proof of funds. In other words, before you can buy a house, you have to prove that you have the means, financially, to make that kind of purchase.

What constitutes proof of funds? An official document, or documents, with specific financial information included. As a buyer, you will probably need proof of an adequate down payment and closing costs. A preapproval letter from a lender is often not enough.

Some buyers may see this as an intrusion into their privacy. Why should the seller, and the seller’s agent, have the right to this kind of information? From the seller’s point of view, however, it makes a lot of sense. Before taking a home off of the market, it’s good to know that the sale won’t fall through because the buyer has a loan, but can’t afford the closing costs or down payment.

To prove that you have the funds to buy a home, you will probably need one of the following:

• certified financial statement
• open equity line of credit
• recent (original) bank statement
• online bank statement
• copy of money market account balance
• signed letter from your bank stating that you have adequate funds for the purchase

Providing a copy of one (or all) of these records proves that you do have the money ready to buy a home, and can expedite the buying process. These documents will be submitted when you sign the contract, or when all of the contingencies on the purchase have been signed off.

If you are a cash buyer, meaning that you will not need a loan to buy the home, providing proof of funds is even more essential. You don’t have the benefit of a preapproval letter stating that the money is available from a lender. You need to be able to prove that the entire cost of the home is readily available for the sale. You will need one of the documents listed above.

If you have more questions about providing proof of funds when buying a home, your Syracuse real estate agent, or your lender, should have the information you need.

Ever since the economy has struggled, so has the real estate industry. This is why there have been various programs and deals to try to get more people to buy homes and to offer incentives to people to sell their homes. Although these programs and incentives have helped some, many are expiring, or running out of funding. So, before you consider buying a home or selling yours, here are some deals to watch out for and how long they may last. This way you can make the best decision possible for you and your family.

Ask your real estate agent for advice
It is part of a real estate agent’s job to know about all the deals, tax credits, and other incentives offered to buyers or sellers of homes. If you are unsure about a program or incentive, they are a great resource to help get your questions answered and to help you get the best deal possible for everyone.

Decreased Prices
There have been many real estate markets that have seen a huge decrease in the prices of many of the homes. This may be bad news for sellers or people who owe more on their home than it is worth, but it has been a good thing for many home buyers. However, if more people are starting to buy homes, this will increase the demand and home prices may rise once again.

Lower Interest Rates
Mortgage rates have been at record lows for many markets since the struggling economy started. However, many of the programs that are keeping these rates low may have already expired or are getting ready to do so and this means that if the prices of homes fall, interest rates will increase again.

Tax Credits
There has been a federal tax credit and other tax incentives to try to get people to buy homes, especially if you are a first time buyer. Most of these programs though are expiring at the end of April and may not offer an extension, so if you want to buy, you better do so soon.

Timing
Planning whether or not to buy a new home or sell an existing one right now based on current conditions may be risky. Many people think now is a good time, but later may be better. It is best to discuss your options with your real estate agent.

Many of these programs and incentives have helped to support the struggling housing market and have been a great thing for many home buyers. It is important though to keep track of these programs and find out what exactly they mean for you and when they might end. This way you can make a well informed choice about whether or not to buy or sell a home right now.

A first-time home buyer tax credit of up to $8,000 has helped to move housing inventory during an otherwise sluggish real estate cycle. Now both legislators and the business community are hoping to build on the incentive’s success by expanding it.

A number of bills have been introduced in the House and the Senate that lobby for an expansion of the measure. Among the proposed changes:

• Setting a new cap of $15,000.
• Extending the tax break into mid-2010.
• Making the benefit available to all home buyers, not just first-timers.
• Offering a separate tax credit to $3,000 for borrowers who refinance.

USA Today, Stephanie Armour (06/22/09)