Purchasing a home in Tennessee can be expensive. On average, you'll spend between $26,629 and $91,022 in buying costs based on the median home value of $319,167.
These aren't the only costs involved with buying a home! You also have to think about ongoing homeownership costs. These range from $1,185 to $1,376 per month.
If you're looking for a way to cut down on some of your home buying costs, we recommend working with Clever Real Estate. Clever can help you compare expert agents in your local area, no strings attached. We'll help you find a knowledgeable realtor from a well-known brokerage that can use their expertise to lower your cost burden.
Clever will connect you with a top local agent and send you a check after closing. Contact Clever for full-service realtor recommendations.
Average closing costs in Tennessee
| Expense | Amount |
|---|---|
| Earnest money deposit (1-3%) | $3,192 to $9,575 |
| Down payment (3.5-20%) | $11,171 to $63,833 |
| Cash reserves | $3,415 to $5,122 |
| Closing costs (2.25%) | $7,190 |
| Inspection | $206 |
| Appraisal | $206 |
| Moving | $1,250 to $4,890 |
| Total | $26,629 to $91,022 |
Buyer closing costs in Tennessee
While the other costs to buy a house in Tennessee are pretty transparent, Tennessee closing costs are a bit more nuanced. They're actually a series of smaller costs lumped together into one total. Here's a breakdown of all of the Tennessee closing costs you'll likely pay when buying a home.
| Closing cost | Amount |
|---|---|
| Closing fee | $319 |
| Recording fee | $95 |
| Title service fees | $846 |
| Origination fee | $1,596 |
| Underwriting fee | $600 |
| Discount points | $2,553 per point |
| Lender's title insurance | Typically paid by seller |
| Owner's title insurance | Typically paid by seller |
| Prorated property tax | Varies |
| Recordation tax | 0.37% |
| Total | $7,190 |
Does the buyer or seller pay closing costs in Tennessee?
The seller typically pays the bulk of the closing costs in Tennessee. The seller is responsible for costs like title insurance, real estate transfer tax, and recording fees. The seller also pays their listing agent.
- Traditionally, the seller set the fee they were willing to pay a buyer's agent.
- In August 2024, a lawsuit against the National Association of Realtors changed this so that buyer's agents have to negotiate rates directly with the buyers they represent.
- Most buyers will still ask sellers to pay this fee as a concession from their sale proceeds, so the buyer doesn't have to bring more cash to closing.
Will the NAR lawsuit change how real estate commission works?
After losing a lawsuit over their practices in 2024, the National Association of Realtors agreed to change how real estate professionals do business.
As of August 2024, buyer's agents are required to sign an "agency agreement" before providing services to a buyer. This agreement has to specify what services the agent will provide, and how much they will get paid.
Real estate agents are no longer allowed to split commissions with one another. In the past, it was common for a listing agent to collect a 6% fee from the seller, and then split this fee with a buyer's agent who brought a buyer. Going forward, buyer's agents will have to negotiate their fee directly with the buyer they represent.
Learn more about how the real estate commission changes will impact buyers and sellers.
Keep in mind, closing costs are often negotiable. Motivated sellers will sometimes agree to pay for some of the buyer's closing costs. However, to win the negotiation battle, you'll need a great agent who can work out a deal with the seller. Clever can match you with a top agent in your area that can get the seller to shoulder more of the above costs.
Contact us at Clever for top agent recommendations.Cost to buy a house in Tennessee calculator
Ongoing costs of homeownership in Tennessee
Unfortunately, the cost to buy a house is just the beginning. After closing, you'll officially own the home and begin paying for the ongoing costs of homeownership.
Besides the expenses outlined above, you'll also want to consider private mortgage insurance (PMI) and homeowner's association (HOA) fees.
- If you pay less than 20% as a down payment on your house, you'll probably have to pay PMI monthly until you get to 20% equity. For the average Tennessee homeowner, this is between $139 to $470 a month.
- Some neighborhoods have HOA fees for the care and maintenance of common areas. The national average is around $250 per month.
» MORE: The true cost of homeownership
Top ways to save money when buying a house in Tennessee
1. Look into better financing options
Paying off debts and getting your credit in the best shape possible before applying for a loan will help you get a better interest rate, which will lower your monthly payments for the life of the loan.
You can also shop around to compare lenders so you get the lowest fees and interest rates available. It may be a good idea to enlist the help of a mortgage broker if you're not sure how to go about vetting lenders.
2. Participate in home buyer programs in Tennessee
The Tennessee Housing Development Agency has a number of home buyer programs that can help make buying easy. These come either in the form of low fixed-rate loans or down payment and closing cost assistance and are available to income-eligible buyers in Tennessee.
The non-profit Habitat for Humanity is also an option, as it offers low income buyers the chance at an affordable home in exchange for “sweat equity,” such as volunteering or construction-work.
» MORE: First-time home buyer programs everyone should know about
3. Partner with an expert agent
Having an expert agent on your side can ensure you win the negotiating battle with the seller.
Clever can help match you with a knowledgeable, hyper-local agent that knows the ins and outs of how to save you money on your local fees. And best of all, our service is totally free!
Finding a great local realtor is the first step in making your home buying dreams a reality. Our free service matches you with top agents from trusted brands like Keller Williams and RE/MAX.
Enter your zip code to request hand-picked agent matches in minutes. Compare your options until you find the perfect fit, or walk away with no obligation. Try Clever's free service today!
Methodology
The Clever team of researchers gathered data for property taxes, transfer taxes, and recording fees using publicly available information. We found average costs for attorney fees, title insurance, and other services by requesting quotes from local providers.
Home values are based on Zillow data as of February 2025.
