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FAQs

Questions related to
the investment process.

Investing in rental properties in Detroit

1.Why buy homes with MidAmerican Homes?

The MidAmerican process is unbeatable.
We buy properties in strategically designated areas with high rent demand
We remodel the properties with a high-quality standard and rental appeal
We operate a carefully designed rental process in order to assure high-quality tenants
We manage our homes with a highly experienced team, rigorous processes and the highest professional standards

This translates into higher accountability, profitability, security, and a better experience as investor.

2.Are you the owners of the properties?

Yes. We buy our homes from financial institutions, investors, investment funds, cities, counties, probates, and individual homeowners. We obtain free and clear title of every home we sell. This means that in addition to the legal protection of owning your home, every property we sell comes with a title insurance policy from one of the biggest title insurance companies in the U.S.

3.What type of construction do the homes have?

We offer homes in different neighborhoods and cities throughout Southeast Michigan. The construction style varies: some have brick exteriors and others have aluminum or vinyl siding. The size of the homes also varies depending on style: bungalows usually have between 850 and 1200 square feet, while colonials may have between 1100 and 1600 square feet.

4.How can I buy a home with MidAmerican Homes?

The process is simple. For a step-by-step detail, please click here. To obtain more information or to contact us, please click here.

5.How long does it take to buy a property?

After an investor decides to buy a property, we can complete the process in approximately two weeks. The process is simple and can be completed remotely, regardless of what part of the world the investor is currently present. We work with renowned title companies who will perform an extensive title search of each property in order to make sure there are no leans, outstanding bills or invoices related to the property. The title company will provide a title insurance policy in favor of the buyer (issued by one of the biggest title insurance companies in the U.S.) which will ensure that tile remains free and clear.

The title company is also in charge of coordinating the closing of the transaction, which includes (i) proper execution of all closing documentation, and (ii) reception of funds from buyer, which will remain in title company´s escrow account until all closing requirements are met and all documents are properly signed and executed.

6.How do I know that the transaction is secure?

he internet and electronic banking platforms have greatly contributed to making real estate transactions in the U.S. very simple and fast. Nevertheless, we have taken certain security measures to ensure that transactions are done in a secure environment. First, all of our transactions are managed by reputable and licensed title companies. The title company essentially works to warrant that you are purchasing a property with a title free and clear from any leans or other encumbrance. In all our transactions, the title company will issue a title insurance policy that will cover the buyer against problems that may arise with the title to the property. We work with the two largest title insurance companies in the U.S.

The title company is also in charge of receiving the buyer´s funds into its trust account. Those funds will not be disbursed to the seller until all transfer documentation has been signed, verified and properly executed. As a last step funds will be disbursed to seller and the transaction will be closed.

7.What is title insurance?

Title insurance insures the transfer of title of real property to the new owner, warranting, warranting that title is transferred free and clear of leans. Title insurance also ensures that all moneys related to the transaction are disbursed according to the instructions established in the closing documents and statements.

8.Who pays for title insurance?

Title insurance is paid by the buyer since this insures free and clear transfer of title to the new owner.

9.What are closing costs?

Closing costs include all fees and expenses associated with the closing of the purchase and sale transaction, as well as the transfer and recording of title to the new owner. For properties in Southeast Michigan, in the segment that we operate in, closing costs may generally be around $2,000.

10.How is ownership of real property transferred?

In Michigan, transfer of title of a real property is done through a state licensed title company. These title companies manage the entire transaction, both from the buyer and the seller´s side. They manage the title search, legal drafting of documents, disbursement of funds, issuance of title insurance, and recording of new title.

11.Can I own real property if I do not reside in the U.S.?

Yes. The majority of our investors reside outside of the United States. As a non-resident, you can opt to buy the property in your own name or to establish a company for such purpose. If you so require, we can assist you in the creation of your own limited liability company (LLC) in a fast and cost-efficient manner.

12.Is there an advantage in creating an LLC as opposed to buying the property in my own name?

Although we are not legal advisors and we cannot provide legal advice, we believe that creating a limited liability company (LLC) has its advantages with respect to limiting liability.

13.Do you offer a divestment strategy if I decide to sell my property?

Yes. We are a licensed real estate broker and can list your properties on the multiple listing service (MLS) which is geared towards local buyers. We also have a network of international real estate agents who sell properties to investors around the world.

14.Is it possible to buy properties in Detroit for only a few thousand dollars?

While there are properties that sell for just a few thousand in the city, there are often other costs associated with those properties that must be considered. Examples of such costs may be delinquent property taxes, rehabilitation, closing costs, and municipal compliance costs. Additionally, the purchase price is typically indicative of the level of demand in a certain neighborhood, for both prospective renters and purchasers.

Properties that sell for just a few thousand dollars come with real risks, including extended vacancy periods and holding costs (property security, utilities). Generally, those homes can end up being more of a liability than an investment. To mitigate the risks associated with distressed properties, we would recommend buying a turnkey property in the right area that has already been rehabilitated to high standards, tenanted with a screened/qualified tenant, and managed through a quality property management company.

Questions related to property management

15.Which company will manage my property?

Your properties will be managed by our property management subsidiary company, which currently manages a large portfolio of residential properties throughout the Detroit Metropolitan Area. The company has a very experienced and professional team that oversees all properties and operations.

16.Does the tenant provide a security deposit?

Yes. The security deposit is of one to one and a half months rent. The deposit belongs to the tenant throughout the tenancy period and is deposited into a dedicated account of our management firm, following Michigan law.

17.How long is the management agreement?

The management agreement has a 12-month duration and renews automatically for additional 12-month periods. The agreement can be terminated with a 30-day written notice. As legal owner of the property, you reserve the right to evaluate our services and performance and compare costs with other managers in the market. There is no obligation for you to stay with our administration.

18.What is your tenant screening process?

Our tenant screening process is comprised of many stages. First, the applicant´s payment capacity is evaluated based on information provided in the tenant application, and a credit check is performed. Then, a background check is ordered through a special software which includes criminal background, convictions and evictions, among other items. Finally, a personal interview is conducted with the applicant. This process is mandatory for all prospective tenants (including those where the government pays for all or part of their rent).

19.How are maintenance and repair orders managed?

We use a combination of in-house technicians and third-party specialists. We use a 24-hour call center as well as a web portal for tenants to request service. This ensures quick action and resolution of the issue. For repairs costing over $500, written approval is required from the investor. Otherwise, repairs are completed and deducted on the income/expense statement. 

20.What is the management fee?

Our property management fee is $95 per month per unit, which is deducted monthly from owner funds.