State-specific home buying regulations: What buyers need to know

Written by Samantha SheltonNMLS 1647301Updated October 2026

Home buying rules change at the state line, and the differences cost real money. Michigan charges a combined real estate transfer tax of about $8.60 per $1,000 of sale price, $7.50 state plus $1.10 county, and makes the seller liable for the state portion. Your state also writes its own disclosure rules, decides whether an attorney must close your deal, and defines “first-time homebuyer.”

Federal law sets only the floor: a Loan Estimate three business days after you apply, a Closing Disclosure three business days before you close. Everything above it is state law.

Learn how state-specific home buying regulations affect your purchase, disclosure duties, transfer taxes, and down payment assistance. Newer to this? Start with our Home Buying guide.

Key takeaways:

• States control the paperwork you sign: Michigan’s Seller Disclosure Act covers transfers of 1 to 4 residential dwelling units and gives a buyer who gets a late disclosure 72 hours to terminate in person, or 120 hours by registered mail.
• Assistance money is state-administered: Michigan’s MSHDA MI Home Loan pairs with an MI 10K DPA loan of up to $10,000 statewide, requires a 640 minimum credit score, and caps the sales price at $566,355 after June 1, 2026.
• Local deadlines are easy to miss: Michigan buyers must notify the local assessor of a transfer of ownership within 45 days, and file a principal residence exemption affidavit by June 1 or November 1 to catch that year’s levy.

What changes when you cross a state line?

Six categories of rule change state by state, and each one can move your cash to close, your protections, or your eligibility for help. The loan programs themselves are national, conventional, FHA, VA and USDA guidelines don’t change at the state line, but the transaction wrapped around that loan is state law from start to finish.

Our home buying process guide maps the national sequence; the table below is what you overlay on it locally.

What do seller disclosure laws require in your state?

Almost every state requires a seller to give you written information about the home’s condition, but the form, the timing, and your remedy for a late one are all state-written. Nolo’s state-by-state seller disclosure requirements are a fast way to see what your state’s statute covers before you tour.

Michigan shows how specific these rules get. The Michigan Seller Disclosure Act applies to any transfer of an interest in real estate of not less than 1 and not more than 4 residential dwelling units, including land contracts and lease-options, and the seller must deliver the written disclosure statement before executing a binding purchase agreement with you.

If it shows up late, you get a defined exit. When a required disclosure or amendment arrives after the seller has signed a binding purchase agreement, Michigan lets the buyer terminate by written notice. Within 72 hours if the statement was hand-delivered, or 120 hours if it came by registered mail. That right expires once the property transfers by deed or installment sales contract.

Two cautions. A disclosure statement is not an inspection and doesn’t cover code compliance on work the seller did, our guide to the impact of new building codes on home purchases explains why unpermitted improvements surface later. And the form describes what the seller knows, not what’s actually wrong. Hire your own inspector either way.

How much is the transfer tax, and who pays it?

A real estate transfer tax is charged when the deed is recorded, and it’s usually quoted per $500 or per $1,000 of the property’s value. Michigan’s state rate is $3.75 for each $500 or fraction of $500. $7.50 per $1,000, and the county rate is 55 cents per $500, or $1.10 per $1,000, in counties with populations under 2 million. Counties of 2 million or more may authorize up to 75 cents per $500.

On a $300,000 Michigan sale at the standard rates, that’s $2,250 in state transfer tax plus $330 in county transfer tax, $2,580 in total, or $8.60 per $1,000 of price.¹ Michigan statute makes the seller or grantor liable for the state transfer tax and requires payment to the county treasurer within 15 days of delivering the deed, though a purchase agreement can shift who actually funds it.

Confirm two things in your own state: whether cities add a layer on top of the state and county rates, and which side of the table customarily pays. Neither is federal, and neither is guaranteed to match Michigan. If the vocabulary is new, our explainer on a conveyance in real estate covers how deeds, recording and title transfer fit together.

How do transfer taxes compare in four of the states Align is licensed in?

The rate, the unit it is quoted in and the party the statute names all change at the state line. Ohio’s county tax under Ohio Revised Code 322.02 is capped at 30 cents per $100 of value and is levied on, and paid by, the grantor named in the deed. North Carolina’s excise tax under G.S. 105-228.30 is $1 for each $500 or fractional part, and the transferor must pay it. Florida’s documentary stamp tax is 70 cents per $100 of consideration in every county except Miami-Dade, according to the Florida Department of Revenue, which lists a separate 60-cent rate and surtax for Miami-Dade.

Sources: MCL 207.525 and MCL 207.504 (Michigan), Ohio Revised Code 322.02, N.C. G.S. 105-228.30, and the Florida Department of Revenue documentary stamp tax page, all as opened October 2026. Dollar amounts calculated by Align Lending from those rates. Hypothetical example, not an offer. Texas and Louisiana are not shown in this table.

The rate says nothing about who funds the tax under your contract; our guide to seller closing costs covers how those lines are split, and the Michigan transfer tax calculator works the Michigan figure for any price.

Does your state require an attorney at closing?

It depends entirely on your state. The Consumer Financial Protection Bureau’s homebuyer toolkit describes the split by region: in most of the country a settlement agent handles your closing, in several Western states that person is called an escrow agent, and in some states, particularly in the Northeast and South, an attorney may be required.

Michigan residential closings are customarily handled by a title company rather than an attorney, but buyers can and do hire one for estates, land contracts, for-sale-by-owner deals or boundary problems.

One federal protection travels with you into every state: under the Real Estate Settlement Procedures Act, a seller cannot require, directly or indirectly, that you buy title insurance from a particular title company as a condition of selling you the property. A violating seller owes the buyer three times all charges made for that title insurance. Shop title, even where custom says the seller picks.

Why do some states require an attorney to close?

North Carolina writes the attorney’s role into its definition of the practice of law. That definition, in G.S. 84-2.1, specifically includes preparing deeds and mortgages and “abstracting or passing upon titles,” and it says no one unlicensed may prepare a deed or pass upon title for real property located in that state.

Michigan’s statute, MCL 600.916, bars anyone not licensed in the state from practicing law and makes a violation contempt of the supreme court and the circuit court, but it does not list deed preparation or title opinions the way North Carolina’s definition does. Title companies handle most Michigan settlements, so the company you pick matters; our guides on how to choose a title company and the role of escrow in home buying cover that choice.

The title policy you are offered is a second decision. The CFPB explains that an owner’s policy protects you if someone claims an interest in the home from before you bought it, and that you may want to buy one, meaning it is an option rather than a requirement. Our guide to why title insurance is important compares the owner’s and lender’s policies.

Who qualifies for state home buying assistance?

Definitions matter most here, because your state decides what “first-time homebuyer” even means. Michigan’s MSHDA MI Home Loan defines it as not having owned a home in the previous three years, and repeat buyers still qualify in designated targeted areas. Another state may draw that line somewhere else entirely.

Each state channels this money through its own housing finance agency, and the menus differ. HUD’s state-by-state directory covers all 50 states, the District of Columbia and the territories, and HUD’s home-buying resources point to the programs in each one. Expect four variables to differ everywhere you look.

• Income limits: Household income caps typically vary by family size and property location, so the same income can qualify in one county and fail in the next.
• Sales price caps: Michigan’s MI Home Loan caps the purchase price at $566,355 statewide after June 1, 2026; other states set their own, often by county.
• Credit and education requirements: MSHDA requires a 640 minimum credit score, and the MI 10K DPA loan of up to $10,000 requires a housing education class.
• Program form: Assistance arrives as a grant, a deferred second lien, a forgivable loan or a mortgage credit certificate, and the repayment terms differ sharply between them.

Mortgage credit certificates deserve a note. An MCC is issued by a state or local governmental unit under a qualified mortgage credit certificate program, and it lets you claim a federal mortgage interest credit on IRS Form 8396, a credit against tax, not a deduction. It is not the old federal first-time homebuyer credit from 2008 to 2010; that credit is gone, and IRS Form 5405 now exists only to figure repayment of it.²

For a state-by-state view, see our guides to state-specific mortgage assistance programs and first-time home buyer grants and programs. Funding runs out mid-year, so confirm current terms before you write an offer.

Do you need a written buyer agreement before touring a home?

In most cases, yes. Since August 17, 2024, the National Association of REALTORS consumer guide says you will be asked to sign a written buyer agreement before touring a home with an agent, in person or virtually. Visiting an open house on your own does not require one. The guide also says compensation is negotiable, not set by law, and must be clearly defined in the agreement rather than left open-ended or stated as a range. Agent compensation is agreed in writing before you start touring, so you know that cost up front and can build it into your offer.

Texas also puts the rule in state law. Senate Bill 1968, per the Texas Legislature’s enrolled bill analysis, requires a written agreement with a prospective buyer before a license holder shows any home, or before presenting an offer when none is shown, stating that broker compensation is not set by law and is fully negotiable.

Michigan adds its own layer. Under MCL 339.2517, an agent must disclose the type of agency relationship in writing before you share confidential information, a buyer’s agent acts solely on behalf of the buyer, and one agent may represent both sides only with the knowledge and informed written consent of both the seller and the buyer. Agents are licensed under Article 25 of Public Act 299 of 1980, according to the Michigan Department of Licensing and Regulatory Affairs. Our guides on how agent commissions work and the benefits of hiring a buyer’s agent go further.

Which home buying rules are the same in every state?

Five sets of rules follow you across every state line, and they’re the reason a mortgage feels similar everywhere even when the closing doesn’t.

Mortgage disclosure timing

Your lender must give you a Loan Estimate within three business days of receiving your application and a Closing Disclosure at least three business days before you close. That comparison window is federal, so you get it in all 50 states.

Fair housing

The federal Fair Housing Act prohibits discrimination in the sale or rental of a dwelling because of race, color, religion, sex, familial status, national origin or handicap, seven protected classes. States can add to that list but cannot subtract from it: Michigan’s Elliott-Larsen Civil Rights Act, for example, also bars discrimination in a real estate transaction based on age, sexual orientation, gender identity or expression, and marital status.

FHA loans

FHA rules are national, but FHA loan limits are set locally: HUD publishes them by county and metropolitan area, with the one-unit limit generally calculated at 115% of the area median sale price and bounded by a national floor and ceiling. That means the same FHA program buys a different maximum price in Wayne County than in a high-cost coastal county.³

VA loans

VA benefits do not change by state. If your Certificate of Eligibility shows full entitlement, there is no VA loan limit. Your lender still has to approve the loan amount and the appraisal still has to support the price. The VA also does not require a minimum credit score, though individual lenders set their own overlays.⁴

USDA loans

USDA is the one federal program with a geographic test built in: Rural Development only guarantees loans made in areas it has designated as rural, and land used primarily for agriculture or commercial enterprise is ineligible. Those eligibility maps are drawn nationally, not by your state.

Because Align Lending is a broker, we can place conventional, FHA, VA, USDA and state agency loans through partner lenders. Including programs many retail banks don’t offer.

Does the federal lead paint disclosure apply in every state?

It does, for homes built before 1978. The U.S. Environmental Protection Agency rule covers pre-1978 private housing, public housing and federally owned housing, requires the seller to hand over the pamphlet “Protect Your Family From Lead In Your Home,” and gives homebuyers a 10-day period to conduct a paint inspection or risk assessment (EPA page last updated May 27, 2026). A state disclosure form sits on top of this federal one, so a buyer of an older Michigan home receives both.

Plan that window alongside the rest of your inspections; our home inspection checklist for buyers lists what else to schedule.

What Michigan buyers should know

Michigan stacks four state-specific rules on top of the federal floor, and each one costs or saves you money directly.

• Property taxes uncap after a sale: Michigan caps annual taxable-value growth at the lesser of 5% or the inflation rate, but on a transfer of ownership the taxable value resets to the property’s state equalized valuation for the following calendar year. The seller’s tax bill is not the bill you inherit, budget from the uncapped number.
• You have 45 days to notify the assessor: The buyer or other transferee must notify the local assessing office of the transfer within 45 days, on a state-prescribed form.
• Claim the principal residence exemption on time: Michigan’s principal residence exemption exempts your principal residence from the local school operating millage, up to 18 mills. File the affidavit by June 1 for the next summer levy or November 1 for the next winter levy.
• Sellers may owe no state transfer tax at all: Michigan exempts a sale from the $7.50-per-$1,000 state tax when the seller claimed a principal residence exemption and the property’s state equalized valuation at sale is equal to or less than its SEV when the seller acquired it, in an arm’s-length transaction.

One more quirk if you’re shopping distressed property: on a mortgage of residential property of 4 units or fewer, Michigan’s redemption period after a foreclosure sale is generally 6 months when more than 66-2/3% of the original debt is claimed due, so the former owner may still redeem the home after the sale.

How does a Michigan seller get the state transfer tax refunded?

Michigan collects the state tax at recording even when the sale qualifies for an exemption, so the money comes back by application. The Michigan Department of Treasury says the refund is requested on Form 2796, which sellers, or buyers who paid on the seller’s behalf, file within four years and 15 days of the sale, and it asks filers to allow 6 to 8 weeks before calling about the status. For a buyer, this matters when the purchase agreement has you paying the seller’s state tax.

Which Michigan home sales come without a seller disclosure statement?

The Seller Disclosure Act lists transfers it does not cover in MCL 565.953. They include transfers under a court order, such as a probate court administering an estate, transfers by foreclosure sale, transfers to a spouse, parent, grandparent, child or grandchild, and sales of newly built, never-inhabited homes by a licensed residential builder. If you are buying an estate sale, a foreclosure or a new build, expect no statement at all; our guide to the foreclosure process for home buyers covers that path.

Even when a statement is required, MCL 565.955 says a seller does not violate the act by failing to disclose something that could be found only by inspecting inaccessible parts of the home or by someone with expertise in a science or trade. The statutory form in MCL 565.957 also says that, unless otherwise agreed, household appliances are sold in working order except as noted, without warranty beyond the date of closing. Our guides on what a seller’s disclosure is and how to handle seller disclosures explain how to read the form.

What does a Michigan buyer file with the assessor after closing?

Two forms. The first is the Property Transfer Affidavit, Form 2766 (L-4260), listed on the Michigan Treasury property transfer forms page. The new owner files it with the assessor for the city or township where the home sits within 45 days of the transfer, according to the City of Royal Oak assessing page, which says a late filing carries a penalty of $5 per day, up to $200.

The second is the principal residence exemption affidavit, Form 2368. The Charter Township of Waterford assessing page reminds buyers that the home must be purchased and occupied by June 1 for the exemption to apply to that year. The Treasury principal residence exemption page says the exemption is distinct from the Michigan Homestead Property Tax Credit, which applies to income tax returns, and it posts a notice that Treasury PRE audits and denials begin April 24, 2026, so a claim can be reviewed and denied after it is filed. Our homestead exemption filing guide covers the affidavit line by line.

Samantha’s rule for the tax side of the budget: “Don’t build your budget around somebody else’s tax bill.” (Samantha Shelton, interview answers, question 150.) The Michigan property tax calculator and our guide to how property tax assessments work show how to estimate the new owner’s number.

Why does recording the deed matter in Michigan?

Recording is what protects your ownership against later claims. Under MCL 565.29, a conveyance that is not recorded is void as against a later purchaser who buys in good faith and for value. The register of deeds in your county records the deed, and MCL 600.2567 sets the recording fee at $30 per document, regardless of the number of pages.

Counties add steps of their own. Oakland County says warranty deeds, land contracts and any deed with a covenant of warranty must be tax certified at the County Treasurer’s Office before recording, and that its $30 recording fee includes the $4 state survey and remonumentation fee. The state’s format rules in MCL 565.201 require each signer’s name printed beneath a signature in black or dark blue ink, the grantee’s address on the deed, and a top margin of at least 2-1/2 inches on the first page.

Where do Michigan buyers report housing discrimination?

The Michigan Department of Civil Rights takes housing complaints at 800-482-3604. Its fair housing page lists source of income among the bases that state or federal law protects, along with race or color, religion, familial status, national origin, sex, disability, age and marital status, and it defines steering as directing buyers or renters to particular neighborhoods based on race or ethnicity. The HUD Fair Housing Act overview covers the federal complaint route, which applies to getting a mortgage as well as buying a home. Our guide to new fair housing laws tracks recent changes.

FAQ: State-specific home buying regulations

Here are answers to common questions about state-specific home buying regulations.

What home buying rules change from state to state?

The big ones: seller disclosure requirements, transfer tax rates and who is liable, whether an attorney conducts the closing, how property assessments reset after a sale, foreclosure redemption periods, the protected classes your state adds to federal fair housing law, and eligibility rules for state assistance programs. Contract forms and contingency customs differ too, which is why local representation beats a national checklist. Our home buying process guide shows where each state rule attaches to the national timeline.

Do all states offer first-time homebuyer assistance programs?

Yes, in practice. HUD maintains a state-by-state directory of homebuying programs covering all 50 states, the District of Columbia and the territories, and each state runs its own housing finance agency with some mix of below-market first mortgages, down payment assistance and mortgage credit certificates. Michigan’s MSHDA offers the MI Home Loan with an MI 10K DPA loan of up to $10,000 statewide. Income limits, price caps, buyer definitions and funding availability vary by state and change frequently, see our roundup of state-specific mortgage assistance programs.

Is a real estate attorney required to buy a house?

It depends on your state. In some states an attorney conducts the closing; in others, including Michigan, a title or escrow company handles settlement instead. The CFPB notes that an attorney may be required in some states, particularly in the Northeast and South, while a settlement or escrow agent handles closings elsewhere. Even where no attorney is required, hiring one is worth considering for estates, land contracts, for-sale-by-owner purchases or title problems.

What is a real estate transfer tax and who pays it?

A transfer tax is charged when property changes hands, usually quoted per $500 or per $1,000 of value. Michigan’s state rate is $3.75 per $500, or $7.50 per $1,000, and the county rate is 55 cents per $500 in counties under 2 million residents. Michigan law makes the seller liable for the state tax, though the purchase agreement can shift who funds it. Rates, city add-ons and payment customs vary widely, see a conveyance in real estate for how deeds and recording work.

Can a buyer back out after receiving the seller disclosure in Ohio?

Yes, within limits. Under Ohio Revised Code 5302.30, which covers homes with one to four dwelling units, a buyer who gets the property disclosure form after making an offer can rescind by a signed notice delivered within three business days of receiving it. That right ends at the earlier of 30 days after the seller accepted the offer or the closing date.

When does a North Carolina seller have to give the disclosure statement?

No later than the time the buyer makes an offer, under North Carolina’s G.S. 47E-5. If the statement arrives late, the buyer may cancel by written notice, but the right ends at whichever comes first: the end of the third calendar day after receiving the statement, the end of the third calendar day after the contract was made, or settlement or occupancy.

Is a seller’s disclosure required in Texas?

Yes, for previously occupied single-family homes. The Texas Real Estate Commission Seller’s Disclosure Notice, Form 55-1 collects the information required by Section 5.008 of the Texas Property Code about material facts and the physical condition of the property. The current version of the form carries an effective date of May 28, 2026, so check that the seller used it.

Do conforming loan limits change from state to state?

Mainly in high-cost areas. The Federal Housing Finance Agency set the 2026 baseline one-unit limit at $832,750 and the high-cost ceiling at $1,249,125, and special statutory provisions set higher limits for Alaska, Hawaii, Guam and the U.S. Virgin Islands. Our loan limits tool shows all 83 Michigan counties at the baseline and Florida’s Monroe County at $990,150 for 2026.

The bottom line on state home buying rules

State-specific home buying regulations decide the fine print of your purchase: what a seller must disclose, what the transfer tax costs and who owes it, whether an attorney closes the deal, how property taxes reset after the sale, and who qualifies for down payment help. Michigan’s combined transfer tax runs about $8.60 per $1,000 of sale price, its principal residence exemption removes up to 18 mills of school operating tax, and MSHDA’s MI 10K DPA loan can cover up to $10,000 of a down payment. Federal law guarantees only the floor beneath all of it, a Loan Estimate within three business days and a Closing Disclosure three business days before closing.

If you’re ready to buy in Michigan and want the state rules explained alongside real loan pricing, talk to Align Lending. We’ll shop your scenario across our lender network, check your MSHDA eligibility, and show you the numbers side by side. Call 248-506-5727 or start online.

Footnotes:

1. Example figures are hypothetical and for educational purposes only; they do not constitute an advertisement of credit terms or a rate quote under federal or state lending laws. Actual transfer tax owed depends on the property’s value as determined under the applicable statute, the county rate in effect, and any exemptions claimed. Return to text.

2. This is not tax advice. Mortgage credit certificate eligibility, credit percentages and carryforward rules are set by the issuing state or local agency and by the Internal Revenue Code, and they change. Consult a qualified tax professional about your situation before relying on any tax benefit. Return to text.

3. Align Lending is not acting on behalf of or at the direction of FHA or HUD. FHA mortgage limits are published by HUD and are subject to change. Return to text.

4. Align Lending works with VA-approved lenders and is not endorsed or sponsored by the Dept. of Veterans Affairs or any government agency. Entitlement, loan guaranty and credit requirements are set by the Department of Veterans Affairs and are subject to change; individual lenders may apply stricter standards. Return to text.

Sources: Michigan state real estate transfer tax rate of $3.75 per $500, MCL 207.525(1); seller or grantor liability and 15-day payment deadline, MCL 207.523(2) through (3); state transfer tax exemption for a principal residence sold at or below its acquisition-date SEV, MCL 207.526(u). Michigan county real estate transfer tax rate of 55 cents per $500 (up to 75 cents in counties of 2,000,000 or more), MCL 207.504. Seller Disclosure Act coverage of 1 to 4 residential dwelling units, MCL 565.952; delivery before a binding purchase agreement and the 72-hour and 120-hour termination windows, MCL 565.954. Taxable value capped at the lesser of 5% or the inflation rate and uncapping to state equalized valuation following a transfer of ownership, MCL 211.27a(2) through (3); buyer’s 45-day notice to the assessor, MCL 211.27a(10). Principal residence exemption of up to 18 mills of local school operating tax and the June 1 and November 1 affidavit deadlines, MCL 211.7cc(1) through (2), MCL 380.1211(1), and the Michigan Department of Treasury. Michigan foreclosure redemption period of 6 months for residential property of 4 units or fewer where more than 66-2/3% of the original indebtedness is claimed due, MCL 600.3240(8). Elliott-Larsen Civil Rights Act protected classes in real estate transactions, MCL 37.2502(1). MSHDA MI Home Loan first-time buyer definition, 640 minimum credit score, $566,355 sales price limit after June 1, 2026, and MI 10K DPA loan of up to $10,000 with a required housing education class, Michigan State Housing Development Authority. Loan Estimate within three business days of application and Closing Disclosure at least three business days before closing, Consumer Financial Protection Bureau. Settlement agent, escrow agent, and attorney closing practice by region, Consumer Financial Protection Bureau, Your Home Loan Toolkit. Prohibition on a seller requiring a particular title insurance company and treble-damages liability, Real Estate Settlement Procedures Act, 12 U.S.C. § 2608. Federal Fair Housing Act protected classes, 42 U.S.C. § 3604. FHA mortgage limits published by county and metropolitan area at 115% of area median sale price between a national floor and ceiling, U.S. Department of Housing and Urban Development. VA full entitlement carrying no loan limit and no VA minimum credit score, U.S. Department of Veterans Affairs. USDA guarantee limited to designated rural areas and ineligibility of income-producing or agricultural land, 7 C.F.R. § 3555.201(a) and (b)(2). Mortgage credit certificates issued by a state or local governmental unit and claimed on Form 8396, and Form 5405 as the repayment form for the former first-time homebuyer credit, Internal Revenue Service. State-by-state homebuying program directory, U.S. Department of Housing and Urban Development.

This article is for informational purposes only and is not intended to provide legal, financial, or tax advice. State real estate law, disclosure duties, transfer tax liability, closing requirements and assistance program terms change and vary by state, county and city. Consult a licensed real estate professional, attorney, or tax professional in your state about your situation. Program terms and figures shown are illustrative, are not a rate quote or an offer of credit, and are subject to change. Align Lending is an independent Michigan mortgage broker, NMLS #2041154.

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