When you are in the process of buying a foreclosure, there are some things that might happen at closing in Michigan that it is good information to be prepared for. This may also apply to other states, but I know this information to be a fact in Michigan, as I have experienced this as a Realtor helping people buy many foreclosures.
When you go to a closing, if you are paying cash, your closing should be relatively fast, usually taking about a half hour to sign the required papers. If you are financing, you need to prepare for at least a half hour to as much as an hour, depending on what type of loan you are taking out to buy the home. The government type loans, such as VA Guaranteed, FHA and USDA Rural Development for example usually take more time as there are more required documents to sign than conventional loans.
One of the things that might happen at a closing in Michigan is that you will have completed all of the signing, and pay any required payments, and then be informed that you will not be able to receive your keys until the seller signs. You then learn that the seller is not present, and the package needs to be overnighted to another location for their signatures.
Essentially what is happening in that circumstance is that you are attending what is called a ‘Witness Only’ closing. What this means is that the seller, which is usually a bank or mortgage company, is using a centralized title company in the state you live in, and then hiring a local title company close to you that is having your sign documents as a witness. In Michigan the centralized title companies typically used by the banks and mortgage companies are based mostly out of the Detroit area, or sometimes in Lansing.
Where the orders to ‘withhold keys’ comes from is usually the asset manager’s instruction
to the listing agent on how to disperse keys. Some are more strict on this issue than others, and more recent you do not see this happening as much, however it does happen. As a Realtor who represents a lot of buyers, I usually try to work through this issue to get the keys for my buyers at closing and am usually successful.
In either case, the worse case scenerio is that you have to wait a couple of days to receive your keys. With that in mind, I usually recommend to buyers that they do not plan anything to be done or delivered to the house immediately following closing until we know more about when the closing is going to occur, and what the disposition of the seller is in regards to possession of the property and the subject of keys.
Other things you can expect at closing is that you will be required to present to the title company a copy of a picture ID, which is usually a drivers license with most people. In case you do not have a drivers license, you will need to bring a picture ID of some form.
Additionally, any funds you are required to bring to closing, be it a loan or cash sale, will need to be certified funds. This means you will need a certified check from your bank or credit union. The funds are usually payable to the title company handling the closing, so coordinate with your Realtor on who this is.
If you are looking to buy a home in Southwest Michigan, and are interested in foreclosure properties, give me a call at: 269-441-8182 or contact me through my website at: www.michaeldelaware.com.