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Lake Blog

More on Foreclosures

michiganhudhomesSome time ago, I wrote a post on foreclosures and later, I wrote more on foreclosures. Today, there is a lot to say on the subject, so I have a few more thoughts I want to share with you on foreclosures.

When writing an offer on a lender owned property, most lenders require the purchaser to sign a bank addendum. This addendum can be as few as two pages, but the last one I saw was twenty three pages of legal language, all favoring the lender. The addendum covers most everything that is addressed in the original buy and sell agreement, but rewritten to protect the lender.

Every lender has a little different procedure of doing business and a different set of forms to use. These forms are a hassle, but are a must to read. Recently in a discussion, the question was asked how many read the lenderís addendum. Only about twenty percent acknowledged they read the forms or did more than a quick perusal.

Every deal is different, for example when purchasing a repo from HUD, the seller doesnít provide title insurance for the buyer. If the buyer requires a title insurance policy, he/she is to order their own policy and pay for it themselves. HUD does provide a Warranty Deed to the property, where other lenders may provide a limited deed.

When purchasing a repossessed property from Fannie May, they place a restriction on the deed to the property you are purchasing stating you may not resell the property within ninety days of the purchase date. A second restriction is placed on the deed stating you may not refinance the property within 90 days of the purchase date for a sum greater than 20% above the pruchase price.

Other lenders have different quirks or maybe more politely said requirements. If you are going to make an investment of time and money, make sure you also make the investment of time and read and understand all the forms you will be asked to sign in purchasing Michigan real estate. There will be many.

Written by Dave.


michiganstorageWhen considering purchasing a property, often the question of storage comes up. What can be added to store the toys or just where can I store the lawnmower. This can be an even more important question on a lakefront property where a lack of available land may be a problem. That is why often you see a self storage facility near many of the more popular lakefront communities.

A very common question is, ďIf I buy this vacant lot, can I build my garage or pole barn prior to building the cottage or home?Ē Always, always, check with the local township or county zoning official prior to entering into any written contract to buy. The regulations vary from area to area. Most communities (townships) and home owner associations do not allow any construction of storage facilities prior to the home being built. The rational is that rather than a community of residential buildings, a collection of garages or pole barns could line the waterfront, and that would be rather unattractive.

If owning a home or lakefront cottage and extra space is desired, always check before starting construction on your project, or even check before purchasing a premanufactured shed. I know this may seem very elementary, but over the years I have seen a number of instances when sheds, and even garages, had to be removed because someone thought they knew the regulations, but failed to call and confirm.

I know the visitors to this site would never be included in that group.

Written by Dave.

Metes and Bounds Legal Descriptions

LonetreebymichiganlakeOne of the longest, and sometimes confusing, legal descriptions for real estate is the Metes and Bounds Legal Description. It may be a description that reads as follows, ďA parcel of land situated in the NW ľ of Section 23, T11N-R9W, XYZ Township, ABC County, being described as beginning at the Northwest corner of said section 23, thence directly south 330 feet along North section line, thence 1320 feet West, thence 330 feet north, thence 1320 feet east to the point of beginning.Ē

Now, that description is an example of a simple, easy to read land description. When reading land descriptions, there are a few things you should know and a few terms you should be familiar with. The POB, or point of beginning, is where the survey starts and later will end. The measurements are in usually in feet. At times, an older survey may contain terms, such as, Rods (16 Ĺ feet), Links (7.92 inches), Chains (66 feet), or other units of measurement.

The other element in a survey is the directions. In our simple example above, we just used the four directions, North, East, South and West. Many times the property lines do not run directly North/ South or East/ West, the description will include degrees of the turn with compass bearings. Remember that 360 degrees is a full circle, there are 60 degrees minutes in a full degree, and 60 seconds for each minute.

You guessed it, descriptions can be confusing and complex, but it helps if you know the meaning of some of the old English words that may be used. Metes which means distance, and bounds which means direction, are some of the words that may be used. The purpose of a property description is to give the reader directions he can follow to walk the properties boundaries.

Written by Dave.

Waterfront Appraisal

michiganlakesappraisalToday we have a guest post from Mr. Jim Thrower, an appraiser with Visser Appraisals Ltd. Mr. Thrower has  experience  appraising  property on many of Michiganís lakes and rivers. We thank him for sharing his expertise with us today.

While Michigan is home to over 11,000 lakes, the supply of quality waterfront property is limited. In contrast, the demand for waterfront property is high, as evident by typically smaller lot sizes.

As an appraiser working in West Michigan, I am often presented with the challenge of interpreting this specific market. As an impartial researcher I rely heavily on sales data to discover the market.

Iíd like to pass along one of the more powerful tools in my waterfront property appraisal toolkit.

One of the better barometers in approximating the value of waterfront property (besides hiring a licensed appraiser) is price per lake-frontage foot. To do this you will need to find recent comparable sales.

Below is an example of how the price per foot methodology can be used as a barometer for value.

Total Sale Price / Total Front Feet of Waterfront: Price per Front Foot


The ownerís property has 0.40 acres wi`th 102í of Lake Frontage located on an all sports lake with normal traffic counts in West Michigan.

Comparable #1 sold for $60,000 and has 0.45 acres with 102í of Lake Frontage located on the same lake but next to a very busy public access launch.  Price Per Front Foot: $588

Comparable #2 sold for $74,000 and has 0.40 acres with 103í of Lake Frontage located on the same lake with normal traffic counts. Price Per Front Foot: $718

Comparable # 3 sold for $77,500 and has 0.50 acres with 103í of Lake Frontage located on the same lake with no neighbors and a private drive. Price Per Front Foot: $752

Comparable # 4 sold for $106,500 and has 0.40 acres with 55í of Lake Frontage located on a private drive in a peninsular with views of the entire lake. Price Per Front Foot: $1,936 Of the four comparables sold compís #2 & #3 are most similar with a price per font foot range of $718 Ė $752.

If we take $718 x 102í = $73,236

If we take $752 x 102í = $76,704

A range of $73,236 to $76,704 is very tight and an excellent indicator of value.

The price per font foot methodology is a very useful valuation tool; however, it does have its weakness. Often there are non-quantitative factors that should be factored into the valuation (see comparable #4).

A few examples of these would be:

1. Location


3. Bluff

4. Proximity and conformity with neighbors.

5. Zoning Restrictions

An appraiserís ability to interpret these factors comes from a combination of market research and experience. Maybe this weekend Iíll brush up and take the boat for a little research.

Written by Dave.


michiganshingles2It is hard to find something interesting to say about shingles. One of the costlier repairs or improvements that a home owner has to face is that of the roof. Even replacing a roof on a small cabinís roof can be priced in the thousands of dollars.

We cannot begin to figure out how many roofs we have had installed or replaced over the years, but we know it has been many. And even though it is costly, it is always worth the money. A neglected roof can begin leaking and do far more damage than the cost of the shingles.

There are many types shingles to choose from when roofing. One of the most commonly used shingles is asphalt, but metal, cedar or even slate shingles are also available. Many people when replacing their roof are trying to lower the cost and try to use the least expensive shingle on the market, which would be the asphalt.

The most common and least expensive is the traditional three tab shingle. However our choice and recommendation is to use the next step up. I call it an architectural shingle It has a dimensional wood shake look and is about 30% thicker than standard shingle. Does it cost more? Yes, about 15% to 20% more than a basic shingle, but the results are a much richer look which will add value to your property.

Written by Dave.

A Good Find

michiganknob2As I have mentioned before, I am not a shopper. Occasionally my wife coaxes me to enter a shop and once in a while I find something there that interests me.

Such was the case recently when we visited the Thistle Gallery on Main Street in downtown Douglas. First I was greeted by Mary Glinski, the very friendly owner of this four year old establishment.

For some time we have been looking for unique hardware for our kitchen cabinets and I think we may have discovered what we are looking for at the Thistle Gallery. These unique pulls use polished Michigan stones mounted for use as pulls for drawers and kitchen doors. Each stone is unique, natural and very interesting. The pulls are reasonably priced. I purchased one as a sample to see how it would look in our home. Sharp is the word. The natural look of the stone compliments our wood cabinets and would also look great with granite counter top.

My wife informed me there were many other things of interest that I did not notice. I guess I should listen to my wife more often.


Written by Dave.

Land Value Questions

michiganlakelotRecently I was approached with an opportunity to purchase a parcel of vacant lakefront property. It was a parcel that could be divided into three different lakefront lots. After giving thought to what the expenses of road construction, utility work and other costs associated with a split, I thought about the next obvious question. What could the lots be sold for after all the improvements?

I posed this question to Mr. Jim Thrower who recently wrote a guest article entitled Water Appraisal. In a case of a lakefront property, A lot becomes available for purchase and there are no known comparables for a vacant land sale. The lakefront is almost 100% developed. There are several homes that have been sold. How do you determine that vacant lotís value?

I thought his answer would be of interest to you.

ďGood question. If I cannot find any recent sales within a 10 mile radius of the subject, I will go back in time, 2-3 years tops. I will make time adjustments. If I canít find it those, I will look for recent house sales with tear-downs.  I.E. Somebody bought an older cottage and rebuilt (itís a land sale!!!). This happens a lot on Lake Michigan. If I canít find that, then I will take recent house sale and do a cost approach on the house and back into a land value.Ē

Good answer. Sometimes it is a difficult task to come up with a market value for unusual properties and I think this information helps. 

Written by Dave.

You Pick

michigansalespersonWhen you feel you are ready to make that real estate purchase, or you know it is time to sell that Michigan real estate, who are you going to call?

That is a good question with all the different real estate companies out there. There are many well known national companies with recognizable names like Remax, Coldwell Banker, Real Estate One, Centaury 21 and so many more. Then there are the lesser known names, some small offices with one or two people, some with many sales people and many locations. There are a lot of options to choose from.

Are you better off with the well known name companies with large advertising budgets or a small office that advertises personal service? There are pros and cons for both.

I have come up with my own take on the subject. Donít pick the company for its size, name or lack of name. Make your decision based upon the person Ė not the company he or she works for. A person who demonstrates that he or she is knowledgeable about the market, the location, the type of property you have or are interested in. Nothing substitutes for his or her first hand experience.

I know many will disagree with my simple take on this subject, but over the years it has worked for me.

Written by Dave.


michiganshinglesEstimateĒ, Webster defines it as an approximate computation of the probable cost of a piece of work, made by a person undertaking to do the work.

Recently on a job we are doing, we had to replace the roof. It has lived out its life and frankly, should have been replaced years ago. For whatever reason, probably a lack of money, the former owner of the property neglected their responsibilities and choose to live with leakage.

The first estimate seemed high for the number of square feet the job required. After asking around as to who others had used in the past, we set out to get four estimates from four different Michigan roofing contractors. We gave each contractor the same requirements as to the shingles and the work required. All seemed eager to do the work. We received four very different estimates. The low estimate was $4,700 and the highest was $9,950. The two in the middle were $7,000 and $7,500.

You might be thinking take the low estimate and run with it right? Thatís not what we did. We took the next one higher. The reason is when we counted the costs of shingles, plywood, nails, drip edge and other items including the dumpster, was there was no way he could have done the job for that price. The materials came to more than that. Taking that quote would have been future trouble for the home owner.

Always get several estimates. Remember, if it sounds too good to be true, it most likely is too good to be true!

Written by Dave.

Daylillies Revisited

michigandaylilyWell, itís that time again. The daylilies are blooming. You canít travel very far in Michigan without seeing those familiar bright orange blossoms and the spiky leaves. You see them as a border along someoneís lawn and growing wild along the roadside.

Occasionally, while traveling through the countryside, you will see a batch of them in what appears to be the middle of nowhere. This always tells me that at one time there was a farm homestead on the site. Years ago, a farmwife (or the farmer himself!), lovingly planted these hoping for many years of color to brighten the landscape. Well, the farm and itís buildings are long gone, but the daylilies continue to bloom. That tells you how hardy this plant is!

I had never given much thought to why daylilies were named daylilies. I guess I just assumed they opened during the day and closed at night. I have since found out that the daylily blossom only blooms for one day, a pretty brief life, but the many blossoms per stem make for a long running display of color.

Someone who owned our property in the past must have loved daylilies, because our property is filled with them. But, thatís OK with me because I like the splash of color they provide. I sometimes wonder how old these plants are and how many changes have taken place on the property since the were planted. If only daylilies could talk!

Written by Dave.

Riparian Rights Made Simple

michiganlakesriparianrightsSometime ago I posted on Riparian Rights and later posted More on Riparian Rights. I was asked recently out what you can and cannot do with your Michigan waterfront. Generally speaking, you may have sand brought in to place and spread along your shoreline. You may not place any sand or any other type of fill on or under the water of the lake. You may construct a seawall at or above the high water line, but you may not construct a seawall below the high water line or in the lake. You may construct a seasonal dock of 300 feet or less on your waterfront, but nothing permanent or longer than 300 feet. You may use the water for sprinkling of the lawn or other domestic purposes. You may not dredge or dig any channel to connect a pond or wetlands to the lake. No construction of a marina or any building below the high water mark. If you are in doubt, call the local office of the DNR or DEQ.

Written by Dave.