What is the Buyers Financial Information?
The BFI aka the Buyers Financial Information is a document that Buyers use to show a proof of funds when making a cash offer. This document is not always used or required, but it is often seen in Chester County even when making an offer with a mortgage, so I wanted to mention it. I really like to use this form for clients to start thinking about their debt to income ratio and what they can afford a month as a mortgage.
The first 7 questions determine who the buyer is and how you plan to purchase and use the property.
After that it asks about the assets you own like bank accounts.
Then liabilities you owe like car payments, or student loans.
Finally it covers income.
All of this information gives the seller a really good idea of who the buyer is and whether or not the sale will go through smoothly or not, but it also gives buyers and idea of what they are working with.
I will often have my buyer clients fill this out especially if they haven't gone to see a lender yet so that they can start to prepare themselves for the questions that their lender will ask like "what would you like to see as a monthly payment?" It also helps to give an idea of what might need to be saved towards a down payment or closing costs and if there are any extra monthly costs that can be cut.
Submitting this document along with your offer can make your offer stand out by proving that you are a solid buyer who has come prepared with all the necessary financing-- HOWEVER a BFI does not take the place of a preapproval or pre-qualification letter from a lender if you require a mortgage to purchase. It also does not cover everything required in a preapproval, so if you require a mortgage, always make sure to speak to a mortgage broker or loan officer to get preapproved.
Comments