Unique Property = Unique Factors

We consider ourselves very fortunate to have created a niche that allows us to represent some of the most unique and impressive properties in all of Northern Michigan. Very often we are working with buyers who are looking for a truly exceptional property that is really one of a kind. It's important for potential buyers to realize that a truly unique property can create some interesting situations that they should be aware of. Due, in part, to drastic changes in the lending industry over recent years, it can be quite difficult to find "conventional" financing for some properties. Typically with conventional financing, the lender will order an appraisal to ensure the property's value before lending the money. Recent changes in the industry have tightened the requirements on appraisals to a point that it can be nearly impossible to conduct an accurate appraisal in some segments of the market. Some lenders require appraisers to provide at least 3 comparable properties wtihin a 10 mile radius that have sold within the past 6 months. When you're looking at unique river and lakefront property, this is virtually impossible. This problem has been especially evident when purchasers choose to use lenders that are either out of the area or are national internet based lenders. Most of these lenders just do not understand that we don't sell "subdivision" homes that are a dime a dozen. It's not as if you can just pull up the other 12 homes that sold within the development in the past year and determine a fair value. When we're talking about a 4,000 square foot log lodge on 13 acres, they aren't exactly all over the place. A piece of acreage on an all sports lake with a lot of frontage only comes up every few years in some cases.

There are other avenues of financing, including "portfolio" products that look closely at a purchaser's credit history and income to debt ratios rather than the value of the property itself. Typically rates are a little higher and the term is a little shorter, but it's often the best bet. The other option is just to go with conventional financing and be prepared to pick up the difference if the appraisal does not come in at purchase price. It's not necessarily that the value isn't there, it's just that there is not enough information available to come up with an accurate number. Either way, I would definitely recommend tying in with a local lender who understands the area and the type of property sold there. They will be better able to ensure that the appraisal is conducted by someone with a good base of knowledge in the area and can coordinate with the title company and other services that they work with on a day to day basis. It's a terrific thing to find that "special" one of a kind property, but it is important to be informed about the unique circumstance that can arise at the time of purchase. Good luck in the hunt. Hopefully we can help not only find that perfect property, but assist throughout the process to make it an exciting and smooth process.