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Old 05-21-2007, 11:49 AM
 
1 posts, read 21,618 times
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Default Who typically pays the closing costs in Michigan?

I am preparing to buy a house in the Ann Arbor area this summer/fall and I am looking for information on traditional real estate transactions in Michigan.

Who usually pays for the closing costs? I have read that this can go either way depending on which state you live in. With the current market being a "buyers market", is it typical to ask the sellers to cover all or 1/2 of the closing costs?

Thanks for your time...
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Old 05-21-2007, 11:51 AM
 
Location: West Bloomfield
418 posts, read 1,254,842 times
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We just bought, and our sellers are not paying closing costs. We didn't ask them to, but then we're dealing with a relocation so my husband's company will pay our closing costs. But...we worked with a very good realtor, and she never mentioned the sellers paying for closing.

Sorry I'm not much more help!
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Old 05-21-2007, 01:12 PM
 
Location: Sitting on a bar stool. Guinness in hand.
2,661 posts, read 3,250,022 times
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Default what it comes down to.

Hello

It really depends on who has the "leverage" over the other.
If the seller needs to rid themselves of a place, then typically the seller is willing to take on the closing cost. But if the buyer needs or really want to buy a place, Then the buyer may want to and/or have to pay for the closing costs. Also remember all transactions are individual so there is not typical.
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Old 05-21-2007, 02:05 PM
 
Location: Working on relocating
800 posts, read 3,044,401 times
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We paid our own, but it definitely depends on the transaction for sure as others have mentioned.

With the housing market the way it is in Michigan, you may be able to get the sellers to pay 1/2, depending on how motivated they are, but don't necessarily count on it.

Best of luck with your transaction!
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Old 05-21-2007, 02:59 PM
 
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Actually both sides pay part of the closing costs. The seller pays the state transfer tax, just under 1% of the selling price. The buyer pays back the seller the unused portion of their property tax paid. The rest of the closing costs are from the buyers mortgage, recording fees, doc prep fees, title insurance, the list goes on and on. Some sellers will contribute money toward closing costs, this is more likely to happen with a new home. Not to many homeowners will offer to pay closing costs or a portion of, but if you dont ask you will never know.
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Old 05-22-2007, 07:39 AM
 
Location: Grafton, Ohio
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Default Depends on what you ask for

When we purchased in 2005, we asked the seller to pay $2000 towards closing costs with the agreement we would pay his asking price (it was $10K less than appraised value). The actual cost was $2200 and we paid the difference.

Like everyone else said, if the seller is motivated to just rid themselves, you might end up with a fabulous deal. If they can sit on it a while, they might be a harder sell. We're selling but can sit on it for a while... we'll only entertain offers that fit what we need to see for the property.
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Old 05-25-2007, 03:55 PM
 
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I personally think it is rude to ask a seller to pay YOUR costs. This is something you should expect to pay when buying a house, just as you would expect to pay sales tax when you buy something at a store. Sellers have costs of their own to cover, and if they are buying another house and have to pay closing costs on that, it can become quite a burden. And it's not nice to take advantage of their eagerness to sell. Be nice and pay your own costs. That's your responsibility.
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Old 06-09-2007, 07:25 AM
D_J
 
Location: Michigan
58 posts, read 443,461 times
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Quote:
Originally Posted by Barbiego View Post
I personally think it is rude to ask a seller to pay YOUR costs. This is something you should expect to pay when buying a house, just as you would expect to pay sales tax when you buy something at a store. Sellers have costs of their own to cover, and if they are buying another house and have to pay closing costs on that, it can become quite a burden. And it's not nice to take advantage of their eagerness to sell. Be nice and pay your own costs. That's your responsibility.
I don't see why this is rude. It goes on every day. It is a business transaction and should be approached that way. I agree, ask for it. The worse case is that the seller won't do it but typically they will pay for at least a portion of it. If you don't at least ask you could be leaving money at table (the closing table that is). There are no state rules on this just mortgage lender guidelines that typically dictate how much the seller can contribute to the borrowers closing costs but it is typically from 3-6% of the selling price.
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Old 06-09-2007, 11:35 AM
 
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It's not rude, it's doing business. Keep in mind that buying a home is a business transaction and most likely will never deal with those people again in your life. As far as I've always known (anywhere I've lived) it's common procedure for the buyer to ask the seller to pay all or part of their closing costs. The seller can refuse or counter offer. But it really depends on who has the upper hand as already mentioned. If they have realy want out of their home and it's been on the market 6 months or even longer, you are in a pretty good position to get them to pay all your closing costs. Don't worry, they are going to ask the same thing of the next person they buy from!

When we sold our home in Las Vegas the buyer asked us to pay all the closing costs. We said no, but we did meet them half way and paid half of it. It's standard procedure. If you are in a lagging real estate market you will most likely get them to pay all or part of it. Only in hot markets would they probably flat out refuse to pay any of it.
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Old 06-10-2007, 02:27 AM
 
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Every deal is different. Win wins can be had on most deals. Most times it's best to pay the closing costs if you're the buyer when it's a company type move. They (the company etc.) will often pay you back the full out of pocket costs.

I've paid the closing costs as a buyer and had the seller instead pay several points (1 point = 1% of the mortgage amount borrowed) to lower my monthly mortgage payments. I would rather have a permanently lower interest rate (and cheaper payments) instead of the having the seller pay the one time closing costs.

By the way, if the seller pays your points - YOU (as a buyer) get the write off on income taxes. It's a sweet deal and it seems not many buyers have the seller pay points. I bought my last house that way and ended up with a really low interest rate.
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