Resource Library · Buyers
Home Buyer's Guide
Buying a home in Michigan involves a specific sequence of decisions, disclosures, and deadlines. This guide walks through each stage so you know what to expect before the first showing and long after closing day.
Step 1
Getting pre-approved.
A pre-approval letter is a lender's written commitment that you qualify for a mortgage up to a specific amount, based on a verified review of your income, assets, debts, and credit history. It is not the same as a pre-qualification, which is typically an informal estimate based on self-reported numbers and carries far less weight with listing agents.
Why it matters. In West Michigan's competitive markets (Grand Rapids, Ada, Forest Hills, Cascade), sellers and their agents look at financing strength as part of every offer. A pre-approval tells them your financing is real, verified, and unlikely to fall apart in underwriting. Offers without one are routinely passed over, even when the price is right.
Documents you'll need. Most lenders will ask for two years of W-2s or 1099s, two months of recent pay stubs, two months of bank statements, and a government-issued ID. Self-employed buyers should expect to provide two years of federal tax returns and a current profit-and-loss statement. Nathan works with lenders who are direct about what they need upfront so the process doesn't stall mid-transaction.
Loan types. Conventional loans typically require a minimum 3% down payment with private mortgage insurance (PMI) until you reach 20% equity. FHA loans allow 3.5% down with a credit score of 620 or higher, though they carry mortgage insurance premiums for the life of the loan. USDA loans offer zero down payment for properties in eligible rural areas around Michigan. Each loan type has different rate structures, insurance costs, and qualification thresholds. Nathan can connect you with a lender who will lay out the comparison clearly.
Step 2
Finding your home.
Nathan starts with a conversation about what matters most: commute distance, school districts, lot size, walkability, garage space, proximity to parks or trails. Those priorities become the filters he applies to the MLS, and they guide the showings he schedules so you're not touring twenty homes to find one that fits.
What to prioritize. Separate your needs from your wants before you start looking. A three-bedroom minimum is a need; a finished basement is a want. A school district boundary is a need; granite countertops are a want. Knowing the difference keeps your search focused and prevents decision fatigue when you're seeing multiple homes in a weekend.
Showings with Nathan. Nathan tours unhurried. He points out what he notices about condition, layout, natural light, storage, and neighborhood context. He'll give you honest feedback on whether a home fits what you've told him you need, even when the listing photos make it look perfect. If a property has issues (deferred maintenance, a layout that won't work, a lot that backs up to a busy road), he'll say so.
Step 3
Making an offer.
In Michigan, purchase offers are written on the Michigan Association of REALTORS® standard purchase agreement. The document covers price, earnest money deposit, financing contingency, inspection contingency, closing date, and which personal property (appliances, fixtures, window treatments) is included in the sale.
Earnest money. This is a good-faith deposit that shows the seller you're serious. In West Michigan, earnest money typically ranges from 1% to 3% of the purchase price. The deposit is held in escrow by the title company and applied to your closing costs or down payment at closing. If you back out for a reason not covered by a contingency, the seller may be entitled to keep it.
Contingencies. The three most common contingencies protect you during the period between offer acceptance and closing: the financing contingency (your loan must be approved), the inspection contingency (you can negotiate or walk away based on inspection findings), and the appraisal contingency (the home must appraise at or above the purchase price, or you can renegotiate). Waiving contingencies can make an offer more competitive, but it also removes protections. Nathan will walk you through the tradeoffs honestly.
Competing offers. Multi-offer situations are common in desirable West Michigan neighborhoods. Nathan helps you structure the full package (price, terms, timeline, and how to address seller concerns about financing) so your offer stands out without giving away protections that matter.
Step 4
Inspection and due diligence.
Home inspection. A licensed home inspector examines the property's structural components, roof, foundation, HVAC, plumbing, electrical, and major systems. The inspection report is your roadmap for negotiation. Nathan helps you distinguish between cosmetic issues (which are expected in any resale home) and material defects that warrant a repair request, a credit, or a price reduction.
Appraisal. Your lender orders an independent appraisal to confirm the home's market value supports the loan amount. If the appraisal comes in below the purchase price, you have options: renegotiate the price, bring additional cash to cover the gap, or, if you have an appraisal contingency, walk away. Nathan has navigated all three scenarios and will help you decide which path makes the most sense.
Title search. The title company conducts a search of public records to verify the seller has clear ownership and there are no outstanding liens, judgments, or encumbrances on the property. Title insurance protects you and your lender against claims that arise after closing from defects that weren't discovered during the search.
Step 5
Closing day.
Closing typically takes place at a title company and lasts about an hour. You'll sign the mortgage documents, the deed, and the settlement statement (also called the Closing Disclosure), which itemizes every cost. Nathan reviews the numbers with you before you sit down so there are no surprises at the table.
Final walkthrough. Earlier on closing day (or the day before), you'll walk the property one last time to verify it's in the condition specified in the contract: agreed-upon repairs are complete, included appliances are present, and nothing has been damaged since the inspection.
Michigan transfer tax. Michigan charges a real estate transfer tax at closing. The county transfer tax is $1.10 per $1,000 of the sale price, and the state transfer tax is $3.75 per $1,000. On a $300,000 home, that's $330 county plus $1,125 state, totaling $1,455. In Michigan, the seller customarily pays the transfer tax, though this is negotiable.
Title insurance customs. In West Michigan, the customary practice is for the seller to pay for the owner's title insurance policy (which protects you), while the buyer pays for the lender's title insurance policy (which protects the mortgage company). These customs can vary in other parts of the state, so always confirm during the offer stage.
What to bring. You'll need a government-issued photo ID and a cashier's check or wire transfer for your closing costs and down payment (the exact amount will be on the Closing Disclosure provided at least three business days before closing). Personal checks are not accepted for large sums.
Michigan Details
Michigan-specific notes.
Principal Residence Exemption (homestead exemption). Michigan homeowners who occupy their home as a primary residence can claim the Principal Residence Exemption (PRE), which exempts the property from the local school operating millage, typically 18 mills. On a home with a taxable value of $150,000, that's roughly $2,700 per year in tax savings. You must file a PRE affidavit (form 2368) with your local assessor by June 1 of the year you move in to receive the exemption for that tax year.
Property tax uncapping on transfer. Michigan's Proposal A (1994) caps annual taxable value increases at the rate of inflation or 5%, whichever is lower. When a property sells, the cap is removed and the taxable value resets to 50% of the State Equalized Value (SEV), which approximates market value. This means a home that has been owned for many years may have a taxable value significantly below its market value. After you purchase, your property taxes may increase substantially in the following year when the uncapping takes effect. Nathan will help you estimate the post-purchase tax bill so you can budget accurately.
Seller disclosure requirements. Michigan law (MCL 565.951-966) requires sellers to complete a Seller Disclosure Statement covering known material defects, environmental hazards, and the condition of major systems. For homes built before 1978, federal law also requires a lead-based paint disclosure. Review both documents carefully during your inspection period. They're part of your due diligence.
Next Step
Ready to start looking?
Send Nathan a message. He'll get back to you within one business day to talk through your timeline, answer your questions, and help you figure out the right first step.
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— Nathan Strodtbeck, REALTOR®