CLOSING COSTS 
When Buying a home in Michigan

There is no standard formula that determines your closing costs when buying or selling a home.  You should discuss your closing costs with your Realtor and mortgageestate professional in advance so that there are no unpleasant surprises when you finalize your transaction.  In other words every closing has a different closing cost figure.  It varies from mortgage company to mortgage company.

A buyer may request that the seller pay for a percentage of the closing costs from 1- 6% of the sales price.   Remember that is like a price reduction and requires negotiation.  By giving seller´s concessions allows a person with little money to get into a home.  This is something you should discuss with your Realtor when you would like to put as little money down as possible.  Most typical closing costs are listed below.  There are other costs, however, not listed here that may apply to your particular situation.

When you encounter any of the charges listed below, always inspect them carefully to make sure the services were provided before you pay for them.

• COMMISSION 
  The seller will have to pay commission fees to the real estate agents representing both the buyer and seller.

• PROPERTY TAXES
  The seller is responsible for the payment of property taxes until the last day of ownership (the day of closing). Taxes are prorated until the day of closing.  That means the taxes are divided into a daily cost.  The number of days the seller paid for but is not going to be in the house is multiplied by the daily tax rate to get the tax proration.   The buyer is responsible for paying the seller back the unused portion of taxes that the seller had paid already the previous year.

• HOMEOWNER'S INSURANCE
  The buyer is responsible for purchasing a homeowner's policy prior to the close of escrow.   Usually the buyer has to pay for one full year in advance to meet mortgage requirements. 

• ASSESSMENT AND LIENS 
  Any assessments or liens on the property need to be paid and/or resolved before the close of escrow. Examples include tax liens or judgments, etc.  A home sale will not be completed by a title company, unless this is done.  The title company insures that the title is clear.  This is the seller's responsibility.  Your realtor will be following up on this process to get a good title policy from the title company.

• TITLE INSURANCE
  The financial responsibility for title insurance varies from county to county in the country. In Michigan the buyer is responsible for a mortgage title policy (if he is going to have a mortgage) and the seller is responsible for the owners policy. Closing costs, courier fees, mortgage recording fees, wire fees for the title are paid by the buyer.  Check with your Realtor if buying a home outside of Michigan for title customs.

• ESCROW SERVICES
  Like title insurance, the financial responsibility for escrow services varies from area to area. Check with your real estate professional.
  
• APPRAISAL  The buyer is responsible for paying for the appraisal
  
• BANK FEES  Bank fees for the mortgage are paid by the buyers
  
• ESCROWS   Escrows are basically a savings account for your taxes and insurance that the bank holds, collects from you monthly, and pays your taxes and insurance when they come due.  

There are other fees that you may see on the closing statement are: 

PROPERTY INSPECTION FEES paid by the buyer

TERMITE INSPECTION paid by the buyer

HOME WARRANTY  Usually paid by the seller if one is offered in the listing.

UTILITY ADJUSTMENTS  Water bill escrow is paid by the seller.  A final water bill will be ordered and paid by the title company from the water bill escrow.

OCCCUPANCY ESCROW Paid by the seller.  Money held by the title company until the seller moves out.  (Like rent the seller is paying the buyer).

These are some of the closing costs when you buy a Michigan home.  Livingston, Wayne, and Oakland County are similiar that taxes are paid in advance.  Though there are some Michigan counties that the taxes are paid in arrears.