Understanding Closing Costs in Tennessee Real Estate: What Buyers & Sellers Should Expect

Buying or selling a home in Tennessee is an exciting milestone—but one important piece of the puzzle often catches people off guard: closing costs. These are the final expenses that come due when you close on your home, and they can make a big difference in your overall budget.

Whether you’re a first-time homebuyer or preparing to sell your property, understanding what to expect can help you plan ahead and avoid surprises.

💰 What Are Closing Costs?

Closing costs are the fees, taxes, and professional services required to complete a real estate transaction. In Tennessee, these typically range from 2% to 5% of the home’s purchase price. Both buyers and sellers have their own responsibilities when it comes to paying these costs.

🏠 Closing Costs for Home Buyers

If you’re buying a home, here’s what you can expect to pay:

• Loan Origination Fees: Charged by your lender to process your mortgage.
• Appraisal & Inspection Fees: Ensure the home is priced fairly and in good condition.
• Title Search & Title Insurance: Protects you against any legal issues or claims on the property.
• Homeowners Insurance & Property Taxes: Often paid upfront to set up your escrow account.
• Recording Fees & Transfer Taxes: Required by your local government to record the new deed.

Buyer Tip: In some cases, you can negotiate for the seller to cover a portion of your closing costs. A skilled real estate agent can help you navigate these negotiations and potentially save you thousands.

🏡 Closing Costs for Home Sellers

Sellers also have important expenses to consider at closing. Common seller costs include:

• Real Estate Agent Commissions: Typically 5–6% of the sale price, shared between the buyer’s and seller’s agents.
• Title Insurance (Owner’s Policy): Provides protection for the buyer against title disputes.
• Prorated Property Taxes: Covers your portion of taxes up to the closing date.
• Attorney or Escrow Fees: Depending on the location and type of transaction.
• Home Warranty (Optional): A great incentive to attract buyers and give peace of mind.

Seller Tip: While sellers have more upfront expenses, offering to help with a buyer’s closing costs can make your home stand out in a competitive market.

📑 How to Prepare for Closing Day

To ensure a smooth closing, both buyers and sellers should:

• Review all documents carefully.
• Confirm wire transfer details with your title company.
• Avoid last-minute credit or financial changes.
• Stay in close contact with your real estate agent throughout the process.

With the right preparation and expert guidance, closing day can be a celebration—not a stressor.

✨ Final Thoughts

Closing costs are a normal part of every Tennessee real estate transaction, but with the right professional by your side, you can manage them effectively and move forward with confidence.

For a smooth, transparent, and stress-free experience—choose Stacy Hobson of J Hunter Realty at 901.405.0500.

Your trusted Tennessee real estate expert who’s here to guide you from start to close.