[BUYING AND SELLING REAL ESTATE IN MICHIGAN]
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KEY FACTS OF REAL ESTATE ACQUISITIONS UNDER MICHIGAN LAW I. STANDARD FORMS OF AGREEMENTS
III. BUYER’S INSPECTIONS A. Residential. It is typical that a buyer is provided with a 5 to 7-day window to have the property inspected. The skill level of residential home inspectors varies greatly. Inspectors should review the structural elements, roof, windows, soundness of foundation, mechanical equipment (AC and heating units, hot water tanks, etc.) and check for radon gas, asbestos, and pest infestation. In older homes, especially in rural areas, the inspection should look for old fuel oil tanks that can lead to environmental issues if they were not properly closed. It is wise to hire an attorney to review the seller’s title to the property and that review (whether or not an attorney is hired) is much more definitive if a survey of the property is obtained (showing encroachments, easements or restrictions that might affect the ability to add on to the home later, etc.). B. Adverse Possession/Boundary Disputes. A survey obtained during the inspection period should assist in determining any potential adverse possession claims or boundary line disputes ( e.g ., encroachments by a fence, a shed, etc.). Adverse possession and acquiescence to a particular boundary line may happen after 15 years of uninterrupted possession (or location of a fence or boundary marker). A boundary line can be re-established by agreement (through conduct or writing) without a 15-year waiting period. C. Private Septic. If the property is on a private septic system (rather than a municipal sewer), then, depending on the locale, a certificate of inspection
A. Offers to Purchase that are accepted by sellers are the typical form of purchase contract for residential properties. The offer, often negotiated before being signed by all parties, typically sets forth the offered price, proposed closing date, buyer’s inspection and financing contingencies, type of deed conveyance (warranty, special or quit claim), and certain other terms of the transaction. Any proposed change by seller to the buyer’s offer is considered a counteroffer. B. Negotiated Purchase and Sale Agreements are typically utilized when commercial or industrial properties are bought and sold. II. BROKERS A. Buyers and sellers are not required to use a real estate broker or real estate salespersons (a/k/a agents) in connection with the sale of real estate. All real estate brokers and agents must be licensed by the state of Michigan. All real estate agents, while being licensed themselves, must be associated with a licensed broker. B. In most residential transactions, the broker and agent must disclose which party they are representing. Brokers and agents may, through a statutory dual agency disclosure, represent both the buyer and the seller in a residential transaction. C. In the typical transaction, the seller pays its broker a full commission and the seller’s broker will share that commission with the buyer’s broker, if any.
ILN Real Estate Group – Buying and Selling Real Estate Series
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