Proof of Funds
Proof of funds is documentary evidence that a buyer has the liquid capital to complete a purchase: bank or brokerage statements, or a lender's pre-qualification letter. It is provided before a seller discloses confidential information.
Why Does Proof of Funds Matter in a Laundromat Sale?
Proof of funds is the qualification step that protects a seller's confidentiality. An unqualified buyer touring a store is the single most common way a sale leaks to employees and competitors. It is also a filter on seriousness. Buyers who genuinely intend to transact expect the request. Buyers who object to it are telling a seller something useful.
What Does It Look Like in Practice?
Before releasing the financial package, a seller receives a redacted brokerage statement showing $95,000 in liquid assets and a lender pre-qualification letter for $360,000. The buyer is credible for a $400,000 store; the same buyer is not credible for a $900,000 one.
What Should You Check?
- Request it before releasing anything beyond the teaser, every time.
- Accept redacted statements or a lender pre-qualification, not a verbal assurance.
- Match the evidence to the actual injection and reserve requirement, not to the price alone.
Where Does This Come Up?
- Buyer Qualification
- Selling a Laundromat Confidentially: The Disclosure Ladder
- Laundromat NDAs: What a Real Confidentiality Agreement Covers
- Laundromat Valuation: How Stores Are Priced and Why
- Sell My Laundromat: The Confidential Sale Process, Start to Close
Related Terms
- Buyer Qualification — Buyer qualification is the process of verifying that a prospective purchaser has the capital
- Equity Injection — Equity injection is the buyer's own money contributed to a financed acquisition
- NDA (Non-Disclosure Agreement) — An NDA, or non-disclosure agreement
See the full laundromat glossary for all 78 terms.
The Next Step
This page is general information about laundromat transactions, not legal, tax, or investment advice, and not a guarantee of sale price, timing, or financing approval. Verify current rules with your own CPA, attorney, lender, and the relevant state or municipal agency before acting.