Who Picks the Title Company in Tennessee? 2026 Rules
Who picks the title company in a Tennessee home sale?
You may ask yourself, who picks the title company in Tennessee? In Tennessee, the buyer or borrower selects the settlement agent that closes the transaction, subject to approval by the lender. A new state law, Public Chapter 769, took effect July 1, 2026 and confirms that the settlement agency the buyer chooses may also serve as the issuing title insurance agency. Federal law adds a second layer: under RESPA Section 9, a seller cannot require you to buy title insurance from a specific company as a condition of the sale, and a seller who does is liable to you for three times the title charges.
By Khristian Schlemmer | August 18, 2026
Here is the scenario I get a call about every few weeks.
A buyer is three days into their inspection period in Lebanon or Mt. Juliet. The listing agent sends over "the closing information," and it names a title company the buyer has never heard of. Sometimes it is the listing brokerage's own in-house company. Sometimes it is the builder's. The message is friendly and it sounds final: this is who we close with.
It is not final. And as of July 1, 2026, Tennessee law is more explicit about that than it has ever been.
What actually changed on July 1, 2026
Tennessee's General Assembly passed SB394 and HB569 in the spring of 2026. The Governor signed it on April 21, it became Public Chapter 769, and it took effect July 1, 2026. It amends Title 56, Chapter 35 and Title 66 of the Tennessee Code.
Three pieces of it matter to you as a buyer or seller:
1. The buyer's chosen settlement agency can be the issuing title agency. This closes a gap that used to get used against buyers. Previously a buyer might successfully pick their own closing company, only to be told that a different agency would still be "issuing" the title policy. The statute now allows the settlement agency selected by the buyer or borrower to serve as the issuing title insurance agency, subject to the approval rights held by the lender or mortgage servicer.
2. Fee-sharing between two title agencies has to be disclosed in writing and signed. If separate title insurance agencies represent the buyer and the seller and they agree to split premiums, commissions, or other fees, they must tell both parties in writing, and both the buyer and the seller must sign an acknowledgment that they were told. No agency is required to participate in that kind of arrangement in the first place.
3. A title agency cannot claim responsibility for losses under a policy it did not issue. This is a consumer protection point that matters if a claim ever arises. You want it crystal clear which company actually stands behind your policy.
The law applies to Tennessee residential real estate with one to four dwelling units. It does not apply to first-time sales of certain newly built homes and condos, to developments with more than four units, or to properties sold at auction. That new construction carve-out is worth reading twice if you are buying from a builder in a Wilson County subdivision, because builder closings are exactly where the "you have to use our title company" pressure tends to be strongest.
The federal rule that has always been there
Even before this year's state law, you had protection, and most buyers never knew about it.
RESPA Section 9 says a seller of property being bought with a federally related mortgage loan cannot require, directly or indirectly, as a condition of selling the property, that you purchase title insurance from any particular title company. If a seller violates that, the seller is liable to you for three times all charges made for the title insurance.
That is not a slap on the wrist. It is treble damages, and it is why a well-advised listing agent will never put "buyer must use X title" in a Tennessee contract.
There is one narrow exception worth knowing: a seller who pays one hundred percent of the title insurance and related title costs has more room to direct where those dollars go. Since Tennessee custom often has the seller paying for the owner's policy anyway, this comes up more here than you might expect. It is still negotiable, and it is still a conversation, not a command.
"But our brokerage owns the title company"
This is the other version of the same pressure, and it is legal, as long as it is handled correctly.
Brokerages, builders, and lenders frequently own or partly own a title company. Federal Regulation X permits it, but requires an Affiliated Business Arrangement Disclosure delivered in writing at or before the moment of referral. That disclosure has to describe the relationship and give you an estimated range of charges.
The one sentence to look for is the one that says you are not required to use the affiliated provider. Because you are not.
An affiliated title company is not automatically a bad choice. Some of them are excellent, fast, and priced fairly. The problem is never the affiliation. The problem is when the affiliation gets presented as an obligation.
What choosing well is actually worth in dollars
This is not a symbolic right. It moves real money.
Owner's title insurance in Tennessee generally runs around half a percent of the sale price. On a $450,000 home in Wilson County that lands somewhere in the neighborhood of $2,300, though every underwriter uses a tiered rate manual, so quotes vary. Add the closing fee, title search, document prep, courier and recording charges, and you are usually looking at a package worth shopping.
Then there is the discount almost nobody asks for:
The reissue credit. If the property carried an owner's title policy within roughly the last ten years, many Tennessee underwriters will reissue at a reduced rate, frequently described as about seventy percent of the standard premium, or savings in the ten to thirty percent range. On a Lebanon home in the $400,000s that is real money left on the table if nobody asks.
Here is the catch. The title company will not volunteer it. You (or your agent) have to ask, early, and you generally need the seller to produce their old policy or its date. On a home that last sold in 2019 or later, this is one of the highest return questions you can ask in the entire transaction.
For context, that credit can be worth more than the Tennessee Documentary Transfer Tax line you will see at the table, which runs $0.37 per $100 of sale price, or roughly $1,665 on a $450,000 sale.
How I handle this with clients
Tennessee is not an attorney-closing state. Closings here are handled by title companies and escrow professionals, and an attorney is not legally required for a residential purchase. That means the closing company you pick is doing a lot: the title search, the curative work, the escrow, the wiring instructions, and the recording.
So the selection is about competence and communication, not just price. My working order of operations:
Decide the closing company during the offer, not during the inspection period. Write it into the contract. This is a term, and terms are negotiable while the offer is still being negotiated.
Get two or three written quotes. Ask for the full settlement package, not just the premium. Closing fee, search fee, doc prep, courier, recording, and endorsements.
Ask about the reissue credit in the first phone call. Ask whether they will pursue the prior policy from the seller's side.
Ask how they handle wiring and verification. This is not a small question. Fraudulent wire instructions are the single most expensive mistake a Middle Tennessee buyer can make, and the closing company's protocol is your protection. I wrote a full breakdown on protecting your money from real estate wire fraud in Tennessee if you want the checklist.
Ask who the closer is and whether you can reach them directly. A title company that will not give you a name is a title company that will not answer the phone on closing week, which is also when your final walk-through in Tennessee can surface something that needs a last-minute credit or holdback.
Confirm with your lender. The lender retains approval rights. Ninety-nine percent of the time this is routine, but confirm it before you sign anything.
The 2026 market makes this easier to ask for
Two years ago, in a market where sellers held every card, a buyer pushing back on the closing company risked the deal. That is not the market we are in.
Lebanon is running a median of roughly 58 days on market with a median list price near $474,000. The Greater Nashville metro is sitting at roughly 7.2 months of supply and about 54 days on market. Inventory like that changes the tone of a negotiation. Asking to use your own settlement agent is a normal, reasonable, legally protected request, and in this market it very rarely blows up a deal.
The buyers who get this right are not the ones who argue. They are the ones who name their closing company in the offer, calmly, as a standard term, before anybody else names one for them.
If you are financing a condo, add one more layer. The condo loan review rules that changed for Nashville buyers put more weight on the title and HOA documentation, so a closing company that handles condos routinely is worth choosing on purpose.
Frequently Asked Questions
Can a seller in Tennessee require me to use their title company?
No, not when you are buying with a federally related mortgage loan. RESPA Section 9 prohibits a seller from requiring you to buy title insurance from a particular company as a condition of the sale, and a seller who does is liable to you for three times the title charges. Tennessee's Public Chapter 769, effective July 1, 2026, reinforces that the buyer's chosen settlement agency can serve as the issuing title agency, subject to lender approval.
Does the new Tennessee law apply to new construction?
Often not. Public Chapter 769 excludes first-time sales of certain newly built homes and condos, along with developments of more than four units and auction sales. If you are under contract with a builder in Lebanon, Mt. Juliet, or Murfreesboro, read the builder's closing language carefully and ask your agent to confirm which rules apply to your specific contract.
Do I need an attorney to close on a house in Tennessee?
No. Tennessee is not a mandatory attorney closing state, and residential closings are routinely handled by title companies and escrow professionals. You can absolutely hire your own attorney to review documents, and if you do, you pay for your own attorney.
How much does title insurance cost in Tennessee, and who pays for it?
An owner's policy commonly runs around half a percent of the sale price, so roughly $2,300 on a $450,000 home, though rates are tiered and vary by underwriter. Tennessee custom leans toward the seller paying for the owner's policy, but like every other closing cost, it is negotiable and gets settled in the contract.
What is a reissue credit and how do I get one?
It is a discounted title insurance premium available when a prior owner's policy on the same property is recent enough, often within about ten years. Savings are commonly described in the ten to thirty percent range. You have to ask for it, and you usually need the seller's prior policy or its issue date, so raise it in your first conversation with the closing company.
What if my brokerage owns the title company they are recommending?
That is legal, but it triggers a written Affiliated Business Arrangement Disclosure delivered at or before the referral, including an estimated range of charges. That disclosure must make clear you are not required to use the affiliated company. An affiliated title company can be a great choice. It just cannot be a requirement.
Picking the closing company sounds like a footnote. It is not. It decides who holds your money, who catches a title defect before it becomes your problem, and whether you leave a few hundred dollars of reissue credit on the table.
The buyers and sellers who come out ahead are the ones who treat it as a term to negotiate rather than a form to sign. If you are working through an offer right now in Lebanon, Mt. Juliet, Murfreesboro, Franklin, or Brentwood and you want a second set of eyes on the closing terms, I am happy to walk you through it. Reach out anytime.
About Khristian Schlemmer
Khristian is a top-producing Middle Tennessee Realtor and founder of First Class Real Estate, serving buyers, sellers, and investors throughout the Greater Nashville area. With over $60 million in career sales and 200+ homes sold, he is known for creative marketing, strong negotiation, and delivering a true first-class client experience. Born into a family passionate about real estate investing and home building, Khristian combines local market expertise with modern marketing strategies to help clients confidently achieve their real estate goals.
This article is general information about Tennessee real estate practice and is not legal advice. Public Chapter 769 has exceptions, and your contract, lender, and situation control. Consult a Tennessee attorney for advice on your specific transaction.
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