The Tennessee Home-Buying Process: Your Step-by-Step Checklist

The Tennessee REALTORS (TAR) Purchase and Sale Agreement is the standard residential contract form used across Tennessee. It covers the purchase price, financing terms, inspection period, earnest money amount and holder, closing date, possession terms, and more. Before your agent submits an offer, read through the form so you understand what you are agreeing to. Ask your agent to explain any section that is not clear.

Cost: $0

Work with your agent to review comparable recent sales in the neighborhood to arrive at a competitive offer price. Also decide on your earnest money amount, preferred closing date, and any contingencies you need — such as a financing contingency, inspection contingency, or the sale of your current home. A stronger offer is not always the highest price; a shorter timeline or fewer contingencies can also make your offer stand out.

Cost: $0

Your agent submits the signed TAR Purchase and Sale Agreement to the seller's side. If the seller accepts, your earnest money check must be deposited into the principal broker's trust account within the time frame stated in the contract — or, if not specified, within a reasonable time not to exceed three banking days from receipt. Earnest money is not a fee; it is a deposit that goes toward your purchase price or closing costs if the deal closes.

Cost: 1-2% of purchase price typical

The seller may accept your offer as written, reject it, or respond with a counteroffer changing the price, closing date, or other terms. Your agent will advise you on how to respond to each round. The contract is not binding until all parties have signed the same version with no pending changes. Keep your pre-approval letter and financial documents handy in case the seller asks to see them.

Cost: $0

When an offer is written or presented, Tennessee requires that the Confirmation of Agency Status form be completed and attached to or incorporated into the contract. This form records exactly what role each agent plays — whether they represent you as a single agent, the seller as a single agent, or act as a dual agent or designated agent. Under Tenn. Code §62-13-403, the form must accurately reflect the actual agency relationship at the time of the transaction.

Cost: $0

Under the Tennessee Residential Property Disclosure Act (Tenn. Code §66-5-201 et seq.), the seller of a one-to-four-unit residential property must give you a completed disclosure form before or at the time you make a written offer. If it arrives after you go under contract, you generally have the right to rescind based on the disclosure. The form covers known defects in the structure, roof, electrical, plumbing, HVAC, foundation, drainage, flooding history, hazardous materials, and legal encumbrances. Read every line carefully.

Cost: $0

Tennessee law (Tenn. Code §66-5-202) allows sellers to use a Residential Property Disclaimer Statement instead of filling out the standard disclosure form. The Disclaimer tells you the seller is making no representations about the property's condition and is selling it as-is. If you receive a Disclaimer rather than a completed disclosure form, you carry full responsibility for investigating the home's condition through your own due diligence. Make sure your inspector and any specialists you hire are thorough.

Cost: $0

If the home was built before January 1, 1978, federal law requires the seller to give you an EPA lead hazard pamphlet, disclose any known lead-based paint or hazards, and provide any available inspection reports about lead. You also get a ten-day window to conduct your own lead-based paint inspection before you are bound to the contract. This is a federal requirement that applies in every Tennessee transaction involving an older home.

Cost: $0

If you are buying a condominium, the Tennessee Condominium Act (Tenn. Code §66-27-201 et seq.) requires the seller to provide specific HOA documents before or upon contracting. For non-condominium HOA communities, review the CC&Rs (rules), bylaws, current budget, and any pending special assessments. Ask your agent to request the full HOA package right away. HOA fees and rules can have a big effect on your monthly costs and what you can do with the property.

Cost: $0-$200 (resale certificate fees vary by HOA)

In Tennessee, real estate closings are typically conducted by a title company or a closing attorney. Your agent can recommend local options. The title company or attorney will order a title search to make sure the seller actually owns the property free and clear, and they will prepare the closing documents. Getting this started early prevents delays closer to your closing date.

Cost: $0 to open; closing fees paid at closing

A general home inspection covers the visible and accessible parts of the home — roof, attic, foundation, electrical, plumbing, HVAC, windows, and more. Attend the inspection in person if you can so the inspector can walk you through any issues they find. Ask your agent for referrals, but also feel free to research inspectors independently. The inspection contingency period in your contract sets the deadline for completing inspections and raising any concerns.

Cost: $300-$600 typical

Depending on the property and its location, you may want inspections beyond the general home inspection. Middle and East Tennessee have widespread karst geology — limestone bedrock that creates underground voids and sinkholes. If your property is in a karst-prone area, a geological or foundation specialist can assess the risk. You may also want a radon test, a sewer scope, a wood-destroying organism (termite) inspection, or an environmental check for underground storage tanks if the property was previously commercial.

Cost: $100-$400 per specialty inspection

Once you receive the written inspection reports, sort the findings into three groups: safety issues (immediate hazards like faulty wiring or gas leaks), major defects (expensive repairs like a failing roof or foundation problems), and maintenance items (normal wear and tear). Work with your agent to decide which issues you want to ask the seller to repair, credit you for, or reduce the price over. Minor cosmetic items are usually not worth negotiating.

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Your agent will draft a written repair request or credit request to submit to the seller before your inspection contingency deadline expires. You can ask for specific repairs to be completed by a licensed contractor before closing, a reduction in purchase price, or a seller credit at closing that you can use to cover repairs yourself. The seller can agree, reject, or counter your request. If you and the seller cannot reach agreement, you may have the right to walk away and get your earnest money back, depending on how your contract is written.

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Tennessee law (Tenn. Code §68-212-511) requires sellers who have actual knowledge that a property was used to manufacture methamphetamine to disclose that fact to buyers before a contract is signed. If the property is on the Tennessee Methamphetamine Site Registry or if you have any reason to suspect prior meth manufacturing, ask your agent to research the property's history and consider hiring an environmental testing firm. Cleanup costs for a contaminated property can be very high.

Cost: $0 to research; testing costs vary

Now that you are under contract, submit your formal mortgage application with your lender right away. Your lender will pull a full credit report, verify your income and assets, and begin processing. Provide any documents your lender requests as quickly as possible — delays on your end can push back your closing date. Avoid making any major financial moves (buying a car, opening new credit cards, or making large cash deposits) during this period as they can affect your loan approval.

Cost: $0-$500 (application fees vary by lender)

Within three business days of your full loan application, your lender must give you a Loan Estimate — a standardized federal form showing your estimated interest rate, monthly payment, closing costs, and loan terms. Compare Loan Estimates from multiple lenders side by side if you are still shopping. Pay attention to the APR, origination fees, and whether the interest rate is locked or floating.

Cost: $0

Your lender will order an independent appraisal of the property. The appraiser visits the home, reviews comparable recent sales, and produces a written opinion of value. If the appraised value comes in at or above the purchase price, the loan process continues normally. If it comes in below the purchase price, you and your agent will need to decide whether to renegotiate the price with the seller, make up the difference in cash, or exercise any appraisal contingency in your contract.

Cost: $400-$700 typical (paid by buyer)

Talk to your lender about when to lock your interest rate. A rate lock guarantees your interest rate for a set number of days — typically 30 to 60 days — so your rate does not change while the loan is processing. Ask your lender about the cost of extending the lock if your closing is delayed and about whether a float-down option is available if rates drop after you lock.

Cost: $0 (extension fees may apply if closing is delayed)

The underwriter may approve your loan with conditions — items you need to provide or explain before the loan is fully cleared. Common conditions include a letter of explanation for a large bank deposit, additional pay stubs, updated bank statements, or a homeowner's insurance binder. Respond to every condition as fast as you can. Getting a 'clear to close' from your lender is the green light that your financing is fully approved.

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If you are buying a property from a foreign seller (a non-US citizen or resident alien), federal law (FIRPTA — 26 U.S.C. §1445) may require you, the buyer, to withhold a percentage of the sale price and send it to the IRS. The standard rate is 15% of the gross sale price, reduced to 10% if the home is your personal residence and the price is between $300,000 and $1 million. Tennessee has no state income tax and no separate state nonresident withholding requirement, so only the federal FIRPTA rule applies here.

Cost: $0 (withholding amount, not a fee, goes to IRS if applicable)

At least three business days before closing, your lender must send you a Closing Disclosure — a federal form showing the final loan terms, monthly payment, and itemized closing costs. Compare it to the Loan Estimate you received earlier and flag any numbers that changed significantly. Ask your lender or closing attorney to explain any line items you do not recognize before you arrive at the table.

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Your lender will require proof of a homeowner's insurance policy before releasing closing funds. Shop at least two or three insurance companies. The binder or declarations page showing coverage effective on your closing date is what the lender needs. If the home is in a flood zone, your lender may also require separate flood insurance from the NFIP or a private carrier.

Cost: $800-$2,500 per year typical (first year often paid at closing)

Schedule a walk-through of the property within 24 hours before closing. The purpose is to verify that the home is in the same condition as when you made your offer, that any agreed repairs were completed, and that the seller has vacated and left the appliances and fixtures that were included in the sale. Bring your inspection report and your repair request so you can check each item. If repairs were not done or new damage appears, tell your agent immediately before you close.

Cost: $0

Your closing attorney or title company will send you a closing statement showing the exact amount you need to bring. Most Tennessee closings require either a certified cashier's check or a wire transfer — personal checks are typically not accepted for large sums. If you are wiring, verify the wire instructions by calling your closing attorney directly using a phone number you look up independently, not one from an email, to avoid wire fraud.

Cost: Varies (down payment + closing costs)

Contact the utility providers for electricity, gas, water, internet, and trash to schedule service transfers to start on your closing date. Ask your agent or the seller for the names of the utility companies that serve the property. Setting this up a few days early prevents any gap in service on move-in day.

Cost: $0-$200 (deposits may be required by some utilities)

At the closing table, you will sign a large stack of documents including the promissory note (your promise to repay the loan), the deed of trust (which gives the lender a security interest in the home), and the closing disclosure. Read each document before you sign and ask the closing attorney to explain anything you do not understand. The closing attorney is present to facilitate the closing and can answer questions about what each document means.

Cost: $0 (closing attorney fee is part of closing costs)

Typical buyer closing costs in Tennessee include lender origination fees, the appraisal fee, title search and insurance premiums, recording fees, prepaid homeowner's insurance, and prepaid property taxes. Tennessee's realty transfer tax (Tenn. Code §67-4-409) is $0.37 per $100 of consideration and is by market convention a seller cost, but always confirm with your agent and closing attorney who is paying which line items in your specific transaction.

Cost: 2-5% of purchase price typical

After you sign and funds are disbursed, the closing attorney or title company sends the deed to the county register of deeds to be recorded. Once recorded, you are the official owner of the property. In Tennessee, recordation is what creates the public record of your ownership. You typically receive a copy of the recorded deed by mail several weeks after closing.

Cost: $0 (recording fee is included in closing costs)

Once the deed is recorded and all funds have been disbursed, you receive the keys, garage door openers, and any access codes. Possession timing is defined in your Purchase and Sale Agreement — typically at closing, but sometimes at a different agreed time. Change the locks or rekey the property on your first day as the new owner as a standard security precaution.

Cost: $50-$200 for rekeying locks

Title insurance protects you against claims to your ownership that were not discovered in the title search — for example, an old lien, a forged deed in the chain of title, or an undisclosed heir. Your lender requires a lender's title insurance policy, but you should also purchase an owner's title insurance policy for your own protection. This is a one-time premium paid at closing. Ask your closing attorney or title company for the owner's policy option and what it covers.

Cost: $500-$2,000 typical (one-time premium, varies by purchase price)