Home Buying in 48221>Question Details

ami52692, Home Buyer in Detroit, MI

What does buyer to assume c of o mean when buying a home in Detroit, MI with a quit claim deed? How much is a warranty deed?

Asked by ami52692, Detroit, MI Wed Nov 21, 2012

I'm interested in buying a home in Detroit, MI that is priced under $1,000. The terms of the sale is a QCD and if a warranty deed is wanted I must pay for it myself. They also say buyer to assume c of o, does this cost money? What does buyer to assume c of o mean and what is a QCD and warranty deed? How much could closing cost be for a home purchased under $1,000?

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Buyer to assume C of O means that you will have to contact the City Of Detroit to get an ACR. The city will come out and see what repairs the home needs an make a list. This inspection will cost you $295.00. Once that list is made, you will be responsible to make all of the necessary repairs that will bring the home up to code, to make it livable. Once you make the repairs, the city will come back out and reinspect it. If it passes the inspection you will then receive the Certificate of Occupancy.

My guess is a $1,000 home in Detroit will need a lot of repairs. Also, the other side of your question is the QCD. That can be a bit scary because the seller is NOT insuring the title. So you will be inheriting anything and everything that is owed on the home. It could have thousands of dollars in back taxes due, it could have outstanding water bills, it could have liens on it, etc.

So a house that you buy for a thousand dollars could cost you tens of thousands of dollars easily. I am not saying it will, I am saying it very well could. Don't be fooled by the cheap price, do your homework. I don't need to see the home and I can tell you that at the very least, you will need to do repairs to bring the home up to code.

A warranty deed could be expensive to "quiet" the title, and you may need a lawyer to help you do that.

I hope this helps.

Thank you,

Elias Realty
(248) 379-6547
1 vote Thank Flag Link Thu Nov 22, 2012
This was so informative. Thank you
Flag Mon Nov 26, 2012
You must have the home inspected by the city to get the C of O and they will require you to make repairs so the property is up to standards and habitable. I think it is $350. Its really just a way for the city to make extra money. You get a year to comply. The city is not very diligent about this and if you don't do it they probably would never know.

Regarding the Deed, the QCD is a Quit Claim Deed and this is a deed that says the seller is transfering only his interest in the property to you, but he is not giving you any warranty again claims from other people who may have a lien on the property. This property probably was purchased at the Wayne county Tax auction, if so Wayne county only issues a QCD, its generally ok to accept a QCD, but if you want to finance the property the bank will require a warranty deed and title insurance. The cost to get a title title commitment is $600 and it takes about a month, First American Title in Detroit will do this, but this does not include the cost of title insurance which is based on the cost the property, it will cost several hundred more at a closing if you sell with a Warranty deed. You really don't need a warranty deed if you are not financing. You can hire an attorney to do this too and will do a title search and contact any lein holders such as a bank who still may have a recorded lein on the property but they have lost their right to any claim, however all lien's are recorded with the city and when a lien's is satisfied another lien release if filed, this probably was not done on your property so it has a blemish on the title, an attorney get the release also and its called getting a blemish off the title but they charge about $1500 to accomplish the same thing.
0 votes Thank Flag Link Sat Sep 6, 2014
C of O is certificate of occupacy, you simply go to the city before the sale and sign the ACR to assume responsibility for repairs, you will have up to a year to complete the repairs, in theory the city will come back to inspect the property again to make sure the repairs have been made, also the QCD stands for quit claim deed, the owner of the property will just sign their interest over to you, closing cost could be back taxes, etc. which could be a couple thousand dollars or more, you have to be sure about what you are getting into
0 votes Thank Flag Link Thu Dec 6, 2012
Great Answer Haig. Caveat Emptor
0 votes Thank Flag Link Sat Nov 24, 2012
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