A proof of funds letter refers to a letter drafted or created by an investment company, a bank or an individual that mainly offers help in funding certain transactions. It shows the total amount of available funds an individual or company has on hand. This type of letter is usually required when an individual plans to make a huge investment such as purchasing an expensive property. Most providers of loans like hard money lenders and banks also often request for a copy of this letter from their potential borrowers.
To make a proof of funds letter even more effective, a few vital elements should be incorporated into it. This is necessary in ensuring that an investment document turns out to be as trustworthy as possible. One way to make this letter look more professional and trustworthy is to allow an institution or a bank to confirm the specific amount of your readily available funds. A guarantee which states that the money was not illegally deposited should also be present in the letter. This can make the letter even more effective.
Another tip is to make sure that the contents of your proof of funds letter can assist you in showing a more reliable proof to a third party about your account balances. This is usually done to demonstrate the availability of your funds or improve your creditworthiness. Note that these documents are submitted to third parties where accountholders are involved into with an aim of smoothly executing transactions such as asset acquisitions or purchases, leases, loans and the like.
It is also essential for you to remember that proof of funds letter formats are different from other letters since this mainly reflects the name of an accountholder, current balance, account number and any statement that confirms that the accountholder really has available funds for any transaction. Make sure that your letter is written in the most professional manner to boost its effectiveness.