Costs & insurance
Closing costs
The one-time fees due when a mortgage closes — origination, appraisal, title, recording, and prepaid escrow items — typically 2–4% of the purchase price for a Michigan buyer.
What does closing costs mean?
Closing costs settle the mortgage and are separate from your down payment, falling on both sides of the table.
A Michigan buyer typically pays origination, appraisal, lender's title insurance, recording, and prepaid escrow items; the seller usually covers the state and county transfer tax and the owner's title policy.
The one big variable is the escrow prepaid, which swings with the county's property-tax rate and the month you close. Budget roughly 2.5% of the price plus prepaids on the buyer side, and estimate them before you make an offer.
A Michigan example
On the $285,000 median home, a buyer might see roughly $5,700–$11,400 in closing costs at 2–4%, plus prepaid escrow. The seller separately pays the $8.60-per-$1,000 transfer tax — about $2,451 — and the owner's title policy.
Common questions
How much are closing costs in Michigan?
For buyers, roughly 2–4% of the price — about $5,700–$11,400 on the $285,000 median home — plus escrow prepaids. Sellers separately pay the transfer tax and the owner's title policy, so the two sides carry different line items.
Who pays closing costs, buyer or seller?
Both. Buyers cover origination, appraisal, title, and prepaids; sellers by Michigan custom pay the $8.60-per-$1,000 transfer tax and the owner's title insurance. Everything is negotiable, but this split is the default.
Can closing costs be reduced?
Yes — seller concessions, lender credits in exchange for a slightly higher rate, and the title reissue rate on refinances all cut the cash you bring to the table. Ask your lender which apply to your loan type.
Related terms