Middle Tennessee Home Sales, Explained

Residential
Written By Hans Nelson

Buying or selling a home in Middle Tennessee follows a process that's familiar once you've been through it, and confusing the first time. Since August 2024, a few rules about how buyer's agents are hired and paid have also changed. This Q&A walks through the basics for buyers and sellers in Nashville, Murfreesboro, Rutherford County, and the surrounding area.

This article is general information, not legal, tax, or financial advice. Contracts, forms, and rules change, and every transaction is different. For advice on your situation, talk with a Tennessee real estate attorney, your lender, or a tax professional.

What changed for buyers and sellers in August 2024?

As part of the National Association of REALTORS® (NAR) settlement of litigation over broker commissions, two practice changes took effect on August 17, 2024:

  • Written buyer agreements. A buyer working with an agent who is an MLS participant now signs a written agreement with that agent before touring a home. The agreement has to spell out how the agent will be paid.

  • No compensation offers on the MLS. Sellers and listing brokers can no longer post offers of compensation to buyer's agents on a Multiple Listing Service (MLS). Those offers are still allowed. They just have to be communicated some other way.

According to NAR, these changes are meant to give consumers on both sides of the deal more choice and transparency.

Do I have to sign something before I tour a home?

In most cases, yes, if you're touring with an agent who is working with you. NAR's rules say the agreement must be signed before you "tour a home," which means going into the house in person or taking a live virtual tour led by your agent. A "home" here means a residential property with one to four units.

You don't need a written agreement just to talk with an agent about their services, or to walk through an open house on your own.

In Tennessee, the agreement doesn't have to be a full agency (representation) agreement. Tennessee REALTORS® has said it can be a touring agreement, such as its RF145 Buyer's Touring Agreement. Its RF141 is an exclusive buyer representation agreement. Under Tennessee Real Estate Commission rules, an agent who signs an exclusive buyer representation agreement with you also has to confirm in writing whether you'd owe a commission if you bought a property without that agent's help.

What has to be in a buyer agreement?

According to NAR's settlement FAQ, the compensation section of the agreement must include:

  • A specific, conspicuous disclosure of the amount or rate the agent will be paid, or how that amount will be determined.

  • An objective amount, such as $0, a flat fee, a percentage, or an hourly rate. It can't be open-ended, like "whatever the seller offers," and it can't be a range.

  • A term that bars the agent from receiving more compensation, from any source, than the amount in the agreement.

  • A conspicuous statement that agent fees and commissions are fully negotiable and not set by law.

Read the agreement before you sign it. Make sure the services, the length of the agreement, and the compensation match what you and the agent discussed.

Is real estate commission set by law, or is there a standard rate?

No. Compensation is fully negotiable and not set by law. That's true for the listing agent a seller hires and for the agent a buyer hires. No rate is guaranteed, and buyer's agent compensation isn't automatic.

So how do buyer's agents get paid in Middle Tennessee?

The same basic options are still available. According to NAR, a buyer's agent may be paid through one or a combination of these:

  • A fee paid directly by the buyer.

  • A concession from the seller.

  • A share of the listing broker's compensation.

Whatever the source, the agent can't receive more than the amount in your written buyer agreement.

Tennessee REALTORS® forms reflect these options. A buyer can also ask, as a term of the purchase offer, for the seller to pay some or all of the buyer's agent's compensation at closing. That request is negotiable, and the seller can say yes, no, or counter.

One practical point: according to NAR, Fannie Mae, Freddie Mac, and the FHA don't currently let buyers add an agent's commission to their mortgage balance. If you may owe your agent a fee out of pocket, plan for it early.

Can sellers still offer to pay the buyer's agent?

Yes. Sellers can still choose to offer compensation to buyer's agents, for example to make a listing more attractive to buyers. The offer just can't appear on the MLS. Your listing agent has to disclose any such offer to you in writing ahead of time, state the amount or rate, and get your approval.

Sellers can also offer concessions, such as help with the buyer's closing costs, and those can still be noted on the MLS. A concession goes toward the buyer's costs, which makes it different from an offer of compensation to the buyer's agent.

Did the settlement change everything?

The legal requirements did change. Written buyer agreements are now required before touring, and compensation offers have moved off the MLS. In practice, though, many buyers and sellers will find that the day-to-day process looks much the same, apart from the extra paperwork and more upfront conversations about compensation. Sellers can still offer to cover buyer's agent compensation or closing costs, and buyers can still ask for that in their offer. What's different is that every arrangement is now spelled out in writing and negotiated openly.

What should sellers expect when listing a home?

Your listing agreement will set out what your agent is paid and how. As noted above, any compensation your agent offers to a buyer's agent requires your advance written approval.

Tennessee law also generally requires residential sellers to give buyers either a residential property disclosure statement about the home's condition and any material defects they know about, or, in limited circumstances, a disclaimer statement. Some transfers are exempt. Your agent and attorney can tell you which one applies to you.

Where should a buyer start?

Start with a mortgage pre-approval. According to the Consumer Financial Protection Bureau, a pre-approval letter is a lender's statement that it's tentatively willing to lend you up to a certain amount. It isn't a guaranteed loan offer, but sellers often expect one with an offer. Lenders usually check your credit first, and the letters often expire, typically in 30 to 60 days.

How do offers and earnest money work here?

This Q&A uses the Tennessee REALTORS® RF401 Purchase and Sale Agreement as its example. Your contract may be different. The offer covers the price, financing, earnest money, closing date, and deadlines for each step. Everything is negotiable until both sides sign.

Under the RF401, the buyer delivers an earnest money deposit within the agreed number of days to a holder named in the contract. At closing, the deposit is credited toward the purchase price. If the contract ends, the form controls who gets the money. For example, it's refunded to the buyer after a timely termination under certain contingencies, and it can be forfeited to the seller if the buyer defaults.

What happens during inspection and resolution?

Under the RF401, the buyer has an Inspection Period of a negotiated number of days to complete inspections at the buyer's expense. Within that window, the buyer can:

  • Terminate the contract and get the earnest money back.

  • Accept the property "as is."

  • Send the seller a written list of requested repairs or replacements.

A repair request starts the Resolution Period, when buyer and seller negotiate in good faith. If they don't sign a repair agreement, the buyer doesn't accept the property as is, and they don't agree in writing to extend, the contract ends when the Resolution Period does, and the buyer's earnest money is refunded. Septic, well, and wood-destroying insect inspections are handled under this same section when they apply.

What if the appraisal comes in low?

If the buyer is financing, the lender will order an appraisal. The RF401 lets the parties decide whether the contract depends on the appraisal. If it does and the appraisal comes in below the purchase price, the buyer has to notify the seller promptly. The buyer then has three days to either waive the contingency or terminate and get the earnest money back. Buyers and sellers often renegotiate at this stage, but that's up to them.

Who handles closing in Tennessee?

Closing is handled by a closing agency, such as a title company, or by an attorney. The RF401 has each side name its closing agency. The closing agent coordinates the title search, title insurance, loan documents, the deed, and the money transfers. Under the form, the seller provides a general warranty deed and title that a licensed title insurer will insure at regular rates. The cost of the title search and the owner's and lender's title policies is split however the contract says.

What is the Tennessee transfer tax, and who pays it?

Tennessee charges a realty transfer tax of $0.37 per $100 of the purchase price or the property's value, whichever is greater. The county Register of Deeds collects it when the deed is recorded. By statute, the buyer (grantee) pays it. The RF401 also assigns transfer taxes and deed-recording fees to the buyer unless the parties agree otherwise.

There's also a mortgage (indebtedness) tax of $0.115 per $100 of the loan amount. The first $2,000 is exempt.

Illustrative math only: on a $400,000 purchase, the transfer tax would be $1,480 ($400,000 ÷ 100 × $0.37). Your actual closing figures will come from your closing agent and lender.

How can CBS Realty help?

Whether you're buying your first home or selling one you've owned for years, the CBS Realty team can explain your options, the paperwork, and how compensation will work before you commit to anything. Reach us through our Contact page or call 615.278.9800. Our office is at 208 West Castle Street in Murfreesboro.

CBS Realty is a real estate brokerage, not a law firm. This article is general information only and is not legal advice. Forms, rules, and tax rates referenced here were checked against the sources below as of October 2026 and may change.

Sources

Hans Nelson

I am a coffee-loving musician and tech nerd living in Nashville, TN. My company, NelsonWerks, tries to bring together several services that work together, but are almost impossible to find from one vendor: Imagery, IT, and Web Design.

http://www.nelsonwerks.com
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