Are you planning a move in or out of Shelby and trying to pin down your closing costs? You are not alone. Budgeting for those last-mile fees can feel unclear, especially with local items like wells and septic systems in the mix. In this guide, you will learn what buyers and sellers in Shelby, Oceana County can expect, line by line, plus timelines and example budgets so you can plan with confidence. Let’s dive in.
Closing costs at a glance
Closing costs are the fees and prepaids due at settlement beyond your down payment. As a starting point, buyers typically budget 2% to 5% of the purchase price for closing costs. For sellers, the largest cost is usually the real estate commission, often around 5% to 6% of the sale price. Your final figures vary based on loan type, lender, title fees, and local requirements, so always get an itemized estimate early.
Buyer costs in Shelby
Here are common buyer charges you may see on your closing disclosure:
- Earnest money deposit (credited back to you at closing)
- Down payment (separate from closing costs)
- Lender fees: application, processing, underwriting, and origination
- Appraisal and credit report
- Optional mortgage points
- Lender’s title insurance policy (required if you finance)
- Owner’s title insurance policy (optional; who pays varies by local custom)
- Title search and settlement or closing fee
- Recording fees for deed and mortgage
- Transfer taxes or stamps if required in Michigan or locally (confirm with your title company)
- Prepaids: property tax prorations, homeowners insurance, prepaid mortgage interest
- Escrow deposits for taxes and insurance if required by lender
- Survey fee if needed
- HOA transfer fees if applicable
- Inspection fees (home, pest, well, septic) typically paid before closing
Prepaids and escrows
Prepaids are advance payments collected at closing, such as property taxes for your share of the year, the first year of homeowners insurance, and daily interest from funding to your first payment. If your lender sets up an escrow account, you will also deposit several months of taxes and insurance. These items can make buyer cash to close higher than expected, so plan for them early.
Rural tests and surveys
In and around Shelby, many properties have wells and septic systems. Lenders or buyers often request well flow and water quality tests and a septic inspection or certification. If a survey or zoning verification is needed due to acreage or outbuildings, budget for that too. Most of these costs are paid before closing and should be included in your upfront plan.
Seller costs in Shelby
Sellers typically see these items on their settlement statement:
- Real estate commission (often negotiated around 5% to 6% of the sale price)
- Owner’s title insurance premium if local custom assigns it to the seller
- Payoff of existing mortgage(s) and any liens, plus release or reconveyance fees
- Prorated property taxes to the day of closing
- Recording and document preparation fees
- Transfer taxes or documentary stamps if applicable
- Agreed repairs, credits, or home warranty if offered
- HOA dues or transfer fees if applicable
- Closing, attorney, or title settlement fee if used
What gets prorated
Property taxes are commonly prorated based on the most recent bill or county treasurer records. HOA dues and special assessments are also prorated when applicable. Utilities are only prorated if specifically agreed to in the contract.
Local Oceana County factors
- Recording fees: Oceana County uses small fixed fees per document and page. Confirm the current fee schedule with the Register of Deeds through your title company.
- Property tax timing: Michigan taxes are billed locally and prorated to the day of closing. Ask your title company to pull the latest tax history early so there are no surprises.
- Transfer taxes: Michigan rules can differ from other states. Your title company will confirm whether state or local transfer taxes apply and list them on your closing disclosure.
- Title practice: Lender’s title insurance is standard for financed purchases. An owner’s title policy is optional, and who pays can vary by local custom. Confirm with your title company in Shelby.
- Rural considerations: Well and septic inspections, water tests, and occasional surveys are common in Oceana County. If required by a lender or municipality, factor these into your budget.
- Seller disclosures: Michigan requires a written Seller’s Disclosure Statement for most residential sales. Disclosures about well, septic, or known defects can shape negotiations and credits.
- Wire safety: Title companies here urge buyers and sellers to verify wiring instructions by phone using a known number. Avoid relying on email alone.
Sample budgets
These examples are for planning only. Always request exact figures from your lender and title company.
Buyer example: $300,000 purchase
- Down payment (10% example): $30,000 (not a closing cost)
- Estimated closing costs at 2% to 4%: $6,000 to $12,000
- Escrow deposits for taxes and insurance: several hundred to a few thousand based on local tax amounts
- Inspections and well/septic tests paid upfront: about $300 to $1,000 or more depending on tests
- Final cash to close equals down payment plus closing costs plus escrows. Ask for your Closing Disclosure 3 days before closing for the exact total.
Seller example: $300,000 sale
- Commission at a 5% example: $15,000
- Owner’s title policy if custom assigns to seller: varies by title insurer
- Prorated taxes and any HOA dues: depends on timing of closing
- Mortgage payoff: depends on your loan balance
- Estimated seller costs excluding payoff: often 6% to 8% when you include commission, title charges, and prorations. Your exact net depends on payoffs and any concessions.
Your 1–6 month timeline
- 4 to 6 months out: Check credit, review savings, and estimate down payment and closing costs. If selling, start home prep and gather past tax bills and loan statements.
- 1 to 3 months out: Get preapproval if buying. If selling, request payoff info from your lender. Ask for title company referrals and a sample closing statement.
- 2 to 4 weeks out: Buyers receive a Loan Estimate early and a Closing Disclosure before closing. Review all fees carefully with your lender and title company.
- Closing day: Bring certified funds or wire per title company instructions, present ID, and review the final settlement statement.
Get precise local numbers
Ask your lender for a written Loan Estimate and later a Closing Disclosure with final figures. Request a seller net sheet from your listing agent or title company that includes your payoff amount and prorated taxes. Provide your title team with sale price, loan payoff statements, and the most recent tax bill to tighten the numbers.
Ways to reduce costs
- Negotiate seller concessions toward buyer closing costs when market conditions allow.
- Shop multiple lenders for interest rates, origination fees, and points.
- Ask whether the seller can pay for the owner’s title policy if local custom allows.
- Compare title and closing fee quotes. Evaluate any tradeoffs with rate or lender credits.
- Ask your lender whether some fees can be rolled into the mortgage if permitted.
Protect your closing funds
- Call your title company using a known phone number to verify wire instructions.
- Do not rely on emailed instructions without confirming by phone.
- Ask your title or closing attorney for secure delivery methods and written verification.
When you have a clear picture of closing costs, you can negotiate with confidence and plan your move with fewer surprises. If you would like a local estimate tailored to your address and price point, reach out to a trusted Oceana County expert. Connect with Gabriela Peterson for a friendly, bilingual consultation and a personalized cost breakdown.
FAQs
Who pays title insurance in Michigan home sales?
- Lender’s title insurance is typically paid by the buyer when there is financing, while payment for the optional owner’s policy depends on local custom and negotiation in Oceana County.
Are transfer taxes due at closing in Shelby, MI?
- Transfer tax rules vary by state and locality in Michigan, and your title company will confirm whether any state or local transfer taxes apply and list them on your closing statement.
How are property taxes prorated for Michigan closings?
- Taxes are prorated to the day of closing using the most recent tax bill or county treasurer records so each party pays for their share of the year.
Do well and septic inspections add to closing costs in Oceana County?
- Yes, many rural properties require well flow, water quality, and septic inspections or certifications that are often paid before closing and should be included in your budget.
How can I lower buyer closing costs in Shelby, MI?
- Compare lenders, negotiate seller concessions, ask about the seller covering the owner’s title policy if customary, review title fee quotes, and consider lender credits when appropriate.
When will I know my final cash to close as a buyer?
- Your lender and title company will provide a Closing Disclosure with final figures; request it and review it carefully about 3 days before closing.
