Proof Of Funds Letter (Requirements + Sample)

A proof of funds (POF) letter is documentation of a person or corporate entity’s current financial resources that validates the ability of that individual to satisfy a monetary demand.

A POF letter is issued by a verifiable authority such as a bank or other financial institution to certify that a claimant does indeed have money that is at or above a certain threshold with them. In this manner, a person’s current financial standing can be validated with a proof of funds letter as only liquid assets, such as cash, are shown on it. By providing a POF letter when requested, a person who wishes to provide money for some purpose can prove to any interested party that the money to do so exists and is accessible.

Proof of funds letter is alternatively referred to as a POF letter or simply as a POF.

Where Might it be Required?

A POF letter is needed when some party needs verification that a sum of money exists and is readily available to satisfy a financial need.

The most common instances in which a POF letter is requested are:

When buying property

A seller of real property is highly likely to request proof of funds from a prospective buyer. A confirmation that the buyer readily possesses the money to buy the property satisfies the seller’s concern that the buyer is serious and can meet the property’s down payment and closing fees. In this manner, the seller can identify viable buyers and know when to take the property off the market.

A proof of funds letter is not always requested when buying a home, mainly when the home is not being sold through a real estate agent. This, however, is not always the case.

For immigration purposes

Proof of funds may be requested when undergoing an immigration process to another country. Here, a POF letter will assure the immigration authority of the other country that the prospective immigrant has enough financial resources to support themselves and cover living expenses.

For Example:

The Government of Canada, makes it an explicit requirement for visa applicants to demonstrate that they can support themselves and their families when applying under some immigration plans.

Therefore, the applicant must possess a sum of money that must not be a loan and can be used for living expenses.

Tip: A preapproval letter does not serve the same function as a proof of funds. A preapproval letter shows that a moneylending institution has approved the buyer and agreed to provide a loan to cover outstanding expenses. A preapproval letter is typically supplied along with a POF letter; the letter certifies that the down payment and closing fees can be covered, while the preapproval letter assures the rest of the payment.

What are the Requirements for a Proof of Funds Letter?

A proof of funds letter must contain some information to serve its function. Since a POF letter is an official document issued by a financial institution, it typically follows a pattern from which the following can be distinguished:

  • the bank’s name and address displayed on the letterhead
  • an official statement about the purpose of the letter
  • the name of the user for whom the letter is issued
  • copy of money market statement and balance
  • bank certified financial statement
  • copy of an online banking statement
  • a balance of funds in a checking or savings account
  • the signature of an authorized bank employee.

How Does a Proof of Funds Letter Look?

The format of a POF letter is dependent upon the in-house practice of the issuing facility. While some might have additional sections on their issued POF letters, they all contain the information listed above in some format. POF letters are usually written on the official stationery of the issuing institution (a letterheaded paper). Below is a sample of what to expect from a POF letter:


[Name of bank]

[Address of bank]

[Email address] [Phone number]


Dear [Name of receiver],

We, [BANK NAME], through this letter and the enclosed documents, certify that [NAME OF BUYER] has been a customer of our institution since [YEAR] and remains in good standing.

[BUYER NAME]’s [ACCOUNT TYPE] with account number [ACCOUNT NUMBER] contains the sum of [AVAILABLE SUM] USD as of this date. These funds are not restricted by any lien, debts, or encumbrances.

Please see the attached copies of the statements for [BUYER’S NAME] accounts at our bank. Contact the bank if you require further verification of the funds mentioned above.

Yours truly,

[Bank employee name]


How to Get it?

A proof of letter is issued by a bank or some other financial institution and can be obtained by requesting from the appropriate facility. Depending on the institution’s policy, an email or phone call may suffice, while some may need to submit a formal request or a physical appearance. The POF letter should be prepared and issued within a week, often within a day or two.

Proof of Funds V/S Proof of Deposit

Proof of funds certifies that a buyer has enough money to complete a purchase, while proof of deposit shows how much a buyer has in an account and further details how the money was obtained. Mortgage lenders usually request a proof of deposit to see how much money a borrower has to cover the down payment and closing fees of purchase, as well as the source of the funds. Knowing the source of a borrower’s funds allows a lender to determine if the borrower will be able to repay. If the source is steady and reliable such as a stable job, the lender might be more inclined to approve the borrower than if the source is a one-time monetary gift.

Beware of the Scams

Proof of funds documents contain sensitive information about a person’s finances and should not be made available to just anyone. A person can become the target of criminals who falsely request POF letters to view such information. Therefore, thoroughly investigate a person before supplying a POF letter to them.

A POF letter can also be used to attempt a scam, primarily investment-related scams. Victims of this type of scam are tricked into depositing sums of money to fuel a non-existent investment. The scam shows the victim a false POF letter claiming that there is money available to invest in the business.

Key Takeaways

  • A proof of funds letter allows a person to validate their financial standing when required to cover some expense.
  • A POF letter is essential when making large purchases for real property.
  • A bank or other financial institution issues a POF letter.
  • A POF letter is an official document and should appear on official stationery.
  • A POF letter contains sensitive information and should always be kept secure.
  • Contact the supposed issuing bank or the authorities if you receive a suspicious POF letter.

About This Article

Mary Erickson
Authored by:
Business Writing | PhD in Communication and Society
Mary Erickson is an expert in business writing and currently serves as a Visiting Assistant Professor at Western Washington University. She completed her doctoral studies at the University of Oregon, obtaining a PhD in Communication and Society in 2011. Mary is an active member of prestigious academic organizations, including the Modern Language Association, the National Communication Association, and the Society for Cinema and Media Studies. With her deep knowledge and extensive experience in the field, Mary is dedicated to advancing the understanding and practice of effective business writing.

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