Lenders title insurance (mortgagee protection) is a type of insurance that protects the lender from damages caused by title problems. Owners title insurance is a coverage that protects the new owner against losses caused by title issues.
Who pays for title insurance in Michigan?
The seller often pays the owner’s title insurance premium as part of their closing fees in Michigan. The buyer pays for the mortgage or lender’s insurance, which is included in their good faith estimate of closing expenses.
How much are title fees in Michigan?
You must title a car in your name at a Secretary of State office within 15 days after purchasing it. A $15 late fee will be charged if the title is not transferred within that time frame. A $15 title transfer charge will be collected at the time of titling. The cost is $16 if a lien is included. In addition, a 6% usage tax will be collected. When the title is transferred to a father, mother, son, daughter, brother, sister, husband, wife, grandparent, grandchild, stepfather, stepmother, stepchild, stepsister, stepbrother, father-in-law, mother-in-law, brother-in-law, sister-in-law, son-in-law, daughter-in-law, grandparent-in-law, legal ward, or legal guardian of the previous owner, no use tax is collected.
You will be charged a $5 instant title fee in addition to any other fees you may owe if you want instant title service.
Individuals who need to apply for a title can do so at any Secretary of State branch office. Proof of car ownership and proper identity are required for title applications. Instant title service is available at all Branch Offices for people who have misplaced their Michigan driver’s license and need a replacement right once.
This service has a $5 instant title cost in addition to the expenses indicated above. For instant title service, the car owner must come in person. For an immediate title transaction, the owner cannot select an agent. Both owners of a car must come in person for instant title service if there are two owners.
NOTE: When there are two owners on the title record, only one owner needs to appear and sign the title application for duplicate title transactions. The other owner does not need to make an agent appointment. On the duplicate title, both owners’ names will show.
If you can’t locate your vehicle’s title, you can seek a replacement title using ExpressSOS. The payment is $15, and you will receive your title in 14 days. Only the owner named on the title document can receive a replacement title. You will need to visit a Secretary of State office to receive a replacement title if you have submitted a change of address within the last 10 days or if you have an appointment of agent or power of attorney designation.
For the car, you must produce a valid Michigan no-fault insurance certificate.
Your license plate must be current. Bring your vehicle registration number or license plate number with you. Unless you have changed insurance carriers since your last license plate renewal, proof of insurance is not necessary.
The actual odometer reading must be disclosed when the vehicle’s title is transferred or assigned, according to Michigan law.
Furthermore, the seller must state whether the reading is actual mileage, not actual mileage, or exceeds the odometer’s maximum limit (usually over 99,999 miles).
If the vehicle has a gross vehicle weight rating of more than 16,000 pounds, is not self-propelled, or is a 2010 model year or older, this disclosure is not needed (MCL 257.233a).
When transferring ownership, federal law also requires sellers to declare the odometer mileage.
According to the Motor Vehicle Information and Cost Saving Act of 1972, Public Law 92-513, failure to complete a mileage disclosure or supplying inaccurate information may subject the seller to penalties, fines, and/or jail.
Questions? For more information, call the Michigan Department of State Information Center at 888-SOS-MICH (767-6424).
Is title insurance mandatory in Michigan?
In Michigan, you are not required by law to acquire title insurance. However, if you’re buying a house with a mortgage, your lender would almost certainly require it, as mentioned above. After all, the property you’re purchasing serves as collateral for your mortgage payments. The lender will foreclose on your home if you do not make your mortgage payments. They might not get their money if it turns out you don’t have clear title to the property.
So, if you utilize a mortgage to buy a home, your lender will likely need you to get lender’s insurance as well as owner’s insurance. Even if you are not required to purchase homeowner’s insurance, you should do so because it protects you against losspossibly big loss.
Real Estate Transfer Taxes
The great majority of states in the United States, including Michigan, levy real estate transfer taxes. These are taxes that are associated with the transfer of property deeds from the seller to the buyer. A real estate transfer tax is imposed because the change of ownership must be recorded in the corresponding local county.
Although this varies from state to state (or even region to region), in Michigan, the transfer tax is generally paid by the seller. This isn’t always the case, as you can wind up dividing the payments after some wrangling. This is particularly true when the market is skewed toward sellers.
If you agree to split the fees, the state gets $3.75 for every $500 of transferred value (i.e. the property), and your local county gets $0.55 ($0.75 in some counties). The sum is calculated using the ultimate sale price.
Real estate transfer taxes of $1,140 and $167.20 would be required to be paid to the state and county, respectively, based on the median Michigan house valuation of $151,700. You would need to contribute $653.60 if the fees were split 50/50.
Home Inspections
The majority of purchasers undergo a home inspection because their lender needs it and it gives them piece of mind. If a new problem is discovered, you will have more room to negotiate a better price.
The price you pay will ultimately be determined on the size of your Michigan home, but you should expect to pay between $200 and $400.
Origination Fee
Your lender will charge you an origination fee when you go through the process of financing your property. This includes the costs of acquiring the loan and is divided into three categories: underwriting, processing, and application fees. Mortgage lenders often charge between 0.5 percent and 1 percent of the loan amount as fees.
For instance, if you take out a $200,000 mortgage, you will pay between $1,000 and $2,000 in interest.
Earnest Deposit
You may be required to pay an earnest deposit once you’ve identified a qualified Michigan property and placed an offer. This gives the seller confidence that you will complete the transaction.
Although there is no hard and fast rule for how much earnest money you should pay, most buyers spend between 1% and 5% of the ultimate purchase price. For example, if the property was offered for $150,000, an earnest deposit of between $1,500 and $7,500 would be required.
In other circumstances, the vendor may insist on a set price, which is normally between $5,000 and $10,000.
Escrow Fees
For those who aren’t aware, an escrow service is used to safeguard your funds. A third-party intermediary (typically a lawyer or escrow agent) will keep your earnest money and oversee the smooth transfer of the remaining monies.
Reputable escrow companies are essential during the closing process due to the size of the transaction. However, as the buyer, you will be responsible for paying an escrow fee. This typically costs between 1% and 2% of the total sale price. For example, if you buy $200,000 for a home, you should anticipate to pay between $2,000 and $4,000 in escrow fees.
How much is transfer tax in Michigan?
The state and county taxes are both included in the real estate transfer tax. These taxes are imposed at various rates:
Counties having more than two million population may levy a tax rate of up to $0.75 for every $500 of value transferred, rather than the $0.55 rate applied to most counties. However, the population of Michigan’s largest county (Wayne County) was less than $1.8 million in 2017.
Can you get title insurance on a quit claim deed?
If a seller has title insurance, they should check with their lawyer and title firm to see if a quitclaim document would effect their policy. Title insurance is frequently non-transferable.
In most cases, new owners of property transferred through a quitclaim deed can acquire title insurance. While the law may allow the seller to purchase fresh title insurance, the title insurance company may be hesitant to give that insurance if the seller refuses to provide any ownership or encumbrances warranties.
What is title insurance Michigan?
What is Michigan Title Insurance, and how does it work? Title insurance is a type of insurance that covers damages caused by claims of ownership, encumbrances, liens, and other obligations against a property.
How much is a plate transfer in Michigan?
Present your Michigan driver’s license, title, and registration to a branch clerk. When titling a vehicle and transferring a plate, there is a $10 plate transfer cost and a $5 registration fee. When moving a plate registered in your name to a vehicle titled in your name, you may be charged additional registration fees.
How do I remove a name from a car title in Michigan?
Vehicle owners who alter their names should take their title and registration to a Secretary of State branch office to get their names updated.
All owners listed on the title must be present with identification. If an owner is unable to attend, they may complete and sign an Appointment of Agent form appointing someone else to sign on their behalf. The person who has had their name changed will need the name change document or their updated driver’s license. A $15 fee is charged for a revised title. There is no charge for making changes to your registration.
How long does it take to get title insurance in Michigan?
If you have a mortgage, you won’t be able to close until the title search and examination are finished. You will receive the deed to your property as well as your title insurance policy once your transaction is completed. The title process normally takes two weeks, but this might vary greatly depending on the property and transaction type. As the closing date approaches, your real estate agent or escrow/title officer can provide you with updates on the timeline.