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My husband and I are looking into buying a really inexpensive house in Warren, MI with cash. We just graduated from college and we want to pay off our debt before we buy our dream home. It's listed on Realtor.com and only about 14K. I know it needs work but my father in law is a contractor and will do all the work for free.
Do I just call the listing agent? What type of closing cost will be involved? Do I need my own agent for such a low priced sale (I feel if I did have my own agent they would feel it wouldn't be worth there time to show me homes for so cheap)
My husband and I are looking into buying a really inexpensive house in Warren, MI with cash. We just graduated from college and we want to pay off our debt before we buy our dream home. It's listed on Realtor.com and only about 14K. I know it needs work but my father in law is a contractor and will do all the work for free.
Do I just call the listing agent? What type of closing cost will be involved? Do I need my own agent for such a low priced sale (I feel if I did have my own agent they would feel it wouldn't be worth there time to show me homes for so cheap)
Any advice would be appreciated.
Talk to a Buyer's Agent, or two. Someone will help you.
You might call an office and tell the Broker what you are doing, and ask for help.
Helping people is the business we are in...
I would be glad to, but MI is far, far away and too close to the Arctic Circle for me.
Closing costs should be low, since there is no loan.
I agree that your closing costs should be very low. Most closing costs are associated with bank fees and loan down payments.
I would also not worry about asking a buyer's agent for help. If you know this is the house you want then you shouldn't have trouble finding one to show it to you. The seller pays the commission so that doesn't even come out of your pocket.
Definitely choose your own agent to represent you. A $14,000 house is not necessarily a good deal or inexpensive. It depends on the condition of the house, the mechanicals and the location. You may have free labor for repairs and updates but the materials can also be expensive. Make sure you know what you are getting into and are not putting more into this house than you will be able to get out of it. If you will need to borrow money to make repairs and updates, a bank can loan based on what the house will be worth once it's updated. They hold the money in escrow and release it as the expenses occur. I know you plan on paying cash for the home, but if you will need to borrow money for materials, better to do it as a mortgage due to lower interest which is also tax deductible in most cases. As a first time buyer, you may also qualify for grant funds which you may not be aware of without consulting with a bank.
As far as your concern of finding an agent who is willing to do the work for a low priced sale, don't worry about that. Most good agents are more than willing to help their client regardless. They will be glad you contacted them. I recommend finding one who has worked with several first time buyers and is aware of the programs available.
Also - if it's a repo, it's very likely they are offering a minimum commission (in my area it's usually around $1000) which may be more than the commission on a more expensive home. I've helped several clients buy foreclosed homes. I'm obviously not making lots of money on those, but I care about my clients and was glad to handle it for them.
The title company should be able to give you a good estimate of your closing costs, which should be low. If it does happen to be a repo, sometimes they will not pay for the title work, termite treatments or other charges the seller usually pays. I do not know MI real estate law, so will recommend again - choose your own agent to represent you.
jwilson, I've got a realtor friend of mine who recently represented a buyer couple in purchasing a 2 million dollar house. This was the fourth time he had represented them in the past twelve years. The first house they bought with him representing them was for 25 thousand dollars when they bought their first house twelve years ago. Although a realtor won't make much from your 14k transaction, a good realtor will appreciate the opportunity for future business from you and referrals. Good Luck!
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my experience
I actually recently bought a house in MI. Not very near your area but in MI.
OK so here's my experience (which maybe different than yours.
I had been watching a houses for about 9 months in MI. I was a REO (bank owned property) said it need a bit of TLC. Once I decided the property sat long enough that I could really lowball my offer I decided to just email the sellers agent a really lowball offer. Which they rejected. But knowing my first offer was really really low. I upped my offer a little and they took it this time. But I made a contingency with that price,that I before I signed anything I would like to have a property inspector look at it first (believe it cost me $150.00) of my own money. Which they did not problem with. So after I got the lowdown of what type of fixer upper I was getting. I decided it was worth the risk and had the agents Realtor fax me the paperwork for the contract on the house. Now in contract we both decided that I would pay the closing costs and transfer to title, which really only cost me about 160.00 total. This was because I paid in cash also. Now it did take about a month to receive all the final paperwork and the title for my house. I guess this is a normal wait for title to change hands in MI from what I'm told.
So all in all no really problems.
But like I said your situation maybe different than mine. And if you really fell uncomfortable doing this yourself then get a agent. A little money spent now can save you a lot of headaches later.
It's very important that you make sure that the VIN on the house matches the VIN on the registration.
A lot of people miss that.
LOL. If only people knew what you could get in MI. I had a client tell me last week about a house he just bought for 55...hundred, not thousand. He already has it rented for $525 per month. Nice return!
Well... I have a house for sale in the city of Warren. New subdivision and resonable price. The house is moving condition and have a lot of extras.
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my experience
