Reading about closing fees is a good indicator that you are looking to buy a property. Congratulations. Real estate is one of the most financially successful investments you can make. When done correctly, you can see a considerable return on investment and build the home of your dreams. 

Applying for a mortgage and visiting properties is only part of the journey. Once you find the right one, you make an offer. If the offer is accepted the closing process begins. Many lenders require home inspections and appraisals, amongst other tasks before releasing funds. But, once you weed through all the tasks, you arrive at the final close. 

“Closing” is a single action associated with purchasing a property, whether it be commercial or residential. It’s significant as it is the moment where the title officially changes hands and you walk away with the keys. If you’re here reading this, then you are aware of the closing fees associated with buying real estate in Middle Tennessee. 

At Hyde Park Title & Escrow, we’ve been assisting buyers and sellers as they arrive at this final destination. We’re here to walk you through everything you need to know about closing and title fees in Tennessee. 

What closing fees can I expect?

Fee expectations vary widely and are based mostly on the lender and your agreement. Lenders are required by law to illustrate an estimation. As a buyer, you should receive an updated statement outlining all the fees and their final cost before signing the mortgage agreement. It should be noted that the fees at the beginning are just an estimate. They can go up or down depending on the services. 

How much are closing fees in TN? 

The average cost for closing fees in Tennessee range from 1.27% to 1.87% of the final sale. Putting that into perspective, homes in and around Middle Tennessee range from $200K to $300K, which would put the median closing cost around $3,500. Just remember that the bigger the price tag, the higher the closing cost. 

Who pays for the closing?

Who pays for closing depends on what part you are playing in the transaction. Buyers are expected to pay for all things associated with the loan and the home. These items would include such things as appraisals and home inspections. Sellers are paying the commission of the real estate agent if one was used during the transaction and any other charges regarding the transfer. Don’t forget almost all aspects of buying or selling a property is negotiable. If you want to work something out with the other party you might be able to work out a deal.  

What are some of the fees I will be paying?

Examples of closing costs are:

  • Application fee
  • Appraisal 
  • Escrow fee 
  • Credit Report
  • Escrow deposit 
  • Home inspection
  • Homeowner’s insurance 
  • Title Insurance 

What is Title Insurance?

Title insurance protects homebuyers from potential title defects. A title, just for clarification, is a document proving the right to property ownership. That means, whoever is the owner of the title can use the property as they see fit.

Title searches are conducted to confirm the person selling it to you has the right to do so, and there aren’t any defects. Defects could be things like outstanding taxes or liens. It’s critical to have a title search completed by a reputable title company in Middle Tennessee. A thorough review of the records addresses anything that could revoke your rights to ownership. 

How much does Title Insurance Cost? 

The cost of title insurance in Tennessee will vary on a few different factors. The mortgage, credit score, and where you are buying within the state are the determiners. It should be noted that the title insurance is different from homeowners’ insurance. Title insurance isn’t a monthly premium. It’s a one-time cost you pay at the time of close. Choose a title company that can not only do the research, but they can provide you with insurance. 

Is title insurance required in Middle TN?

No laws exist requiring homeowners to purchase this kind of insurance. If you want to waive your right to the coverage, you will not be penalized by the state. However, many mortgage lenders require borrowers to take out title insurance before they release the funds. 

Why would I need title insurance? 

Previously, we mentioned defects — any defect transfers from one owner to the next. If the defect is financial, it becomes the new owner’s responsibility. So, if there are outstanding taxes that were not caught during the search, the government could seek for that money. Title insurance is that financial barrier to ensure you don’t have to make that kind of payment. It would do things like cover the cost of hiring a lawyer, court fees, and any other payments that are required to get the defect removed. 

At Hyde Park Title & Escrow, we offer a full range of title and closing services in Nashville and the surrounding areas. It’s our goal to make the process easier for you. Our team is comprised of seasoned employees who understand how much is riding on a detailed title search and a smooth close. We can help you every step of the way. Visit our services page to learn more. 

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