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Seller Tips

Real Estate Commission Explained

In traditional real estate transactions, real estate commission comes from the net earnings for the seller at closing. So, this money never really changes hands. But that raises lots of questions:

  • If the buyer funds the seller, then is the buyer actually paying for the commission?
  • And if the commission is typically split between the buyer broker and listing broker, why, if I were the seller, would I pay for someone to represent the buyer?
  • When I get a market value or appraisal for my home, does that include broker commission?
  • Does the purchase price include the commission?
  • And are commissions really negotiable?

The answer to most of these ponderings reach back to the traditional real estate industry. Before the 1990s, a real estate agent almost exclusively worked for the seller. Rarely did a buyer have specific agent representation in a residential real estate transaction. So, with this structure, the commission, typically 6 to 7%, was strictly paid to the listing broker for selling the home. Note, the buyer is at a severe disadvantage in this scenario. But that begs the question, “Since there are inherent risks when buying anything, especially a home, how did buyers survive without representation?” The answer is “dual agency,” a form of agency whereby the agent/broker claims to represent the best interests of both the seller and buyer. But even with this model, the agent/broker is willing to pay more attention to the seller, because that’s who paid the commission, and the higher the sale price, the higher the commission payout.

The “buyer representation” concept came to the real estate industry in the early 1990s, when states created laws that protected the buyer by allowing buyer representation, or buyer’s agency. But how was this type of broker/agent supposed to get paid? By adding additional commission to the existing 6 to 7% the listing agent was requiring? No. Each listing agent/broker would begin splitting the commission, and that 6% commission was split, mostly evenly, between each party. This split certainly didn’t sit well with the traditional listing brokers, but when they realized they could regain that “loss” by becoming a buyer representative, things evened out. Dual agency is allowed in Tennessee, but it is outlawed in some states because of a conflict of interests and consumer protection considerations. Home Sense does not practice dual agency.

So, who pays the commission, really? An argument can easily be made for either side of a transaction paying the commission. But since traditionally the seller pays it, it is commonly accepted (or at least advertised) that the seller pays the commission.

The commission structure for most all residential real estate transactions originate from the listing agreement an agent/broker has with a seller. In that listing agreement, the commission for both the listing broker and the buyer broker will be listed. And this buyer broker commission will be advertised in the MLS, but not the listing broker commission. If a seller chooses to set the buyer broker commission below market value in hopes of saving money, buyer agents will have less incentive to show the home to prospective buyers. That’s why it’s important to set the buyer broker commission at market value, which averages 3%.

When a home is appraised, it typically includes real estate commission. When a home sells, the commission is subtracted out of the purchase price and the remaining balance is what the owner retains. So, the asking prices you may see on real estate websites like Zillow,, etc., include the commission.

Are commissions really negotiable? To some degree yes, but usually only in one case. Traditionally, the only negotiable parameter is the commission the seller pays to the listing agent/broker. Before a listing agreement is signed by the broker and seller, the commissions for the seller and buyer broker will be listed, and they are somewhat negotiable. However, once the buyer broker commission is set, it is entered in the local MLS and buyer brokers see the rate and will know how much they profit from the transaction. Under current traditional listing agreements, a buyer cannot submit an offer that reduces the commission structure in favor of a lower offer price.

Is Home Sense Different? YES. And it’s Big.

First, we only charge a listing broker commission of 1%. That alone saves thousands. But there is a Home Sensehidden value. With a traditional listing, as stated above, the commissions are set typically at 3% for the listing and buyer broker, with the total being 6%. So, not matter what, for traditional transactions (not involving Home Sense) there will be a 6% commission paid out because that’s the commission structure set in the listing agreement. Unfortunately, the traditional listing agreements most REALTORS use do not include language pertaining to unrepresented buyers. When an unpresented buyer wants to submit an offer, the listing agent typically assumes the role of a “facilitator” on behalf of the buyer and collects the entire 6% commission! But a facilitator does not necessarily represent the best interests of the buyer, and certainly cannot negotiate on behalf of the buyer because he has responsibilities to the seller. So, the buyer is essentially paying 3% extra for the home and not being fully represented. But what if the savvy buyer realized that and wanted to forgo the facilitator “representation” and be unrepresented? Again, current real estate listing agreements do not allow for that and the buyer is much better off paying the 3% on full representation by hiring a separate agent, rather than pay the facilitator 3%.

But the Home Sense listing agreement is different. It DOES allow for unrepresented buyers with no additional commission to Home Sense. In this case, you will be selling your home for only 0.75% commission to Home Sense. That’s a big difference!! Home Sense doesn’t want the extra 3% commission for buyer representation because we didn’t earn it and would much rather the seller and buyer enjoy the savings.

For Sale By Owner. Is it Really Worth It?

Sure, selling your home without a broker sounds great: save money by not paying the standard 6% commission: 3% for the buyer agent and 3% for the listing agent. But is it really that simple? Roughly 9% of home owners sell their home using the “For Sale by Owner” (FSBO) approach. Let’s look a little closer at some issues the typical FSBO seller may encounter.

Saving on Commission

FSBO sign mage for Knoxville discount realtorChoosing the FSBO approach may not really save you money. According to the National Association of REALTORS, on average, homes sold by agents fetch $230k compared to $180k for FSBO. When you find the right agent, they supply you with the information necessary to price your home to get the most money in the shortest time, a combination that can mean 10-30% more net profit. Granted, these are average prices, and do not necessarily compare “same house sales,” which is impossible. When you are considering saving 6% on a listing commission you should take that into consideration.

No Money Up Front

Listing agents do not charge a fee upfront, unless you, the seller, are using a “flat fee” service. If they spend money and cannot sell your home for the intended price, the agent has incurred the expense, not the seller. This is perhaps one of the greatest things about using an agent… there is an extremely low risk and cost to doing so.


The perception of FSBO sellers is that they are not serious about selling their properties, potentially difficult to negotiate with, and are often just testing the market or seeing if they can get some far-fetched price or find the perfect buyer that isn’t realistic. They are often not taken seriously in the real estate community because they don’t see the value in representation by an agent or broker. Just like attorneys prefer working with other attorneys in their peer industry, real estate agents prefer working with other real estate agents.

When a seller decides to use the FSBO approach, he is telling other agents that he is circumventing the norm and ignoring the value of an agent in a multi-billion dollar industry. Granted, buyer agents can show FSBO homes to their clients and attempt to negotiate a commission with the seller, but unless the FSBO seller specifically states a commission structure, buyer agents will often simply ignore FSBO homes to avoid the hassle of such negotiating, possibly even encountering an FSBO seller who is unwilling to offer any buyer agent commission at all.


You might be ready to post your home on, but you don’t have the ultimate home selling tool – the Multiple Listing Service (MLS). The MLS can be accessed only by licensed real estate agents, and is the way to get your home syndicated on sites like, Zillow, and Trulia.  A large majority of home buyers begin their search on sites like these, and you want your home to be seen by as many buyers as possible to get the best price. Again, agents prefer working with other agents. Plus, when the buyer agent sees the MLS listing, he will know exactly how much commission he would be receiving from the sale.  Zillow and Craigslist won’t show the commission.  Therefore, Zillow and Craigslist aren’t used by agents as a primary source of listing information.


When you sell your home without an agent, any mistakes you make can cost you greatly. Agents have something called E&O (Errors & Omissions) Insurance. This protects them when mistakes are made in contracts. When you sell on your own, others can make sure to exploit every little mistake you make.

Pricing Incorrectly

Pricing your home incorrectly when you list it can be the worst mistake, and can greatly affect days on market and final sales price. Pricing too high will mean fewer people see it, resulting in fewer offers. Price it too low and you’re signaling that something is wrong with the property or that you are desperate to sell. More days on market will also signal to buyers that something is wrong and can ultimately mean less money upon final sale. The value of a Comparable Market Analysis (CMA) and/or a similar valuation approach is very critical in choosing an asking price.

Low Ballers

The FSBO approach also attracts investors and low-ballers who see your perceived inexperience as a prime opportunity. What may seem like a lot to you may be a steal to them.

How to Price Your Home

*** Did You Know? ***

Due to liability issues, many agents will not recommend a starting price for your home and will instead leave that completely up to the seller. They may provide the seller with a Competitive Market Analysis (CMA) and indicate a range of asking prices.

*** Did You Know? ***

Pricing is the foundation of a successful home sale. No matter what condition the home is in or where it’s located, both will be reflected in the sale price.   Pricing a home can be a very emotionally-driven exercise: You may have very fond memories of your home and be inclined to over-estimate its worth. Or, you may be detached from the local housing market and not understand the gold mine you’re sitting on. Either position should be avoided. Buyers have always been very savvy, and with the advent of the internet, they have more tools to use now. But so do you! Below are some tips to help you find a range of your home’s value.

The Numbers

Most buyers will conduct an online home search using a range of prices. For example, they may select homes for sale in the range of $150,000 to $200,000. So, their budget is $200,000. If you want to list your home price at $205,000, it won’t show in this person’s search results, even though your home may eventually sell for $200,000 after negotiating, counter offers, etc. So, pricing your home just above certain thresholds may yield fewer home buyers searching for your home. In this case, you may have better luck pricing it at $199,900. Use this principle on $25,000 thresholds for home up to $200,000. Some examples are:

  • Use $124,900, not $127,000
  • Use $174,500, not $176,500

For homes beyond the $200,000 range, use $50,000 thresholds:

  • Use $349,900, not $355,000
  • Use $799,000, not $803,000

In summary, don’t price your home just above $25,000 or $50,000 thresholds, but instead just under them.

Understand Your Market/Neighborhood

You should understand your neighborhood to help properly set your asking price. Ask yourself:

  • How are the schools and crime in my area compared to other areas in the city or county?
  • How does the size of my house compare with other homes nearby?
  • Is my area quickly accessible to restaurants, entertainment, shopping, transportation?

Try these websites:

What Separates My Home From Others Nearby?

Once you understand your neighborhood, now you need to see what separates your home from other homes in the area:

  • Am I the only with a gravel driveway?
  • Is my home the only one with siding?
  • Is my roof older or newer than most homes?
  • Is my home at the end of a cul-de-sac?
  • Is my home’s curb appeal (landscaping, tidiness, etc.) similar to others nearby?
  • Is my home a 1-story ranch, while most are 2-story colonials?
  • Is my lot much bigger than the others?
  • Is my home significantly smaller than the others?

Then assess any upgrades recently performed on your house. According to, typically roofs, siding, windows, and minor bathroom and kitchen upgrades will return at least 80% of the investment. But, certain things may prevent your home from selling quickly or at your asking price, so you may want to consider the improvement investment, especially if you’re a DIYer:

  • A roof that is unsightly,
  • Poor or no landscaping, relative to other nearby homes, or
  • Conditions that are unsafe, such as foundation problems or an inoperable HVAC system.

You don’t have to make these improvements, just realize that your asking price should reflect the condition of your home.

Determine the Square Footage of Your Home and Property

You will need to determine the square footage of your home and lot before your price it. This can be quickly done by consulting tax records or your recent property tax bill. If you can not locate your bill, call or visit your city or county property assessor’s office. But be careful, this information may not include a recent addition. The lot size will most likely be fairly accurate. When Home Sense advertises your home on a local MLS, it will indicate the source of home information and tax records are a relatively safe source. You may want to check or by entering your address in the home search. Reportedly, their information is obtained from tax records as well.

Finally, you may just want to measure things for yourself. For basements that are heated and cooled in the same manner as the rest of the home, its walls and floors are similar to the rest of the home, it has an entrance to the main floor, and has the same or nearly the same ceiling height as the rest of the home, about half of its square footage can be considered in the total home square footage. Try this method from You may need a friend to help you.

Review Recent Sales Online

A REALTOR, like Home Sense, will provide sellers with a Comparable Market Analysis (CMA), which gathers recent sales information from the MLS to determine an estimated range of your home’s worth. It used to be that only REALTORS had access to recent sales data. But thanks to the internet, anyone can conduct a recent sales analysis. Try these websites:

When conducting a recent sales search:

  • Use about a ½ to 1 mile radius. If this yields too many results, try zooming in.
  • Note the date of sales and try to use only those sales that occurred in the last 6 months. If this yields too many results, use sales from the last 3 months.
  • Enter a square footage search filter value about 20% less than and 20% more than yours
  • Enter some other filters if you would like.
  • Ideally, you will have at least 3 properties that are similar to yours.
  • Total up all the sale prices and square footages of each sold home to get an average $/ square foot value.
  • Now apply this rate to your square footage, which should give you a starting point for your asking price.

For many of the recent sales, the expired listings will still have photos, so you should assess whether your home compares to these homes. Finally, go visit homes currently for sale, determine their $/square foot asking price, compare them to yours, and adjust your starting price accordingly.

Also, note how many days a comparative home took to sell. For slow sellers, you may conclude that the $/square foot was a little high.

Consider Having an Appraisal Done

Perhaps the most accurate and cost-effective way to determine your home’s worth is to hire a competent appraiser. For approximately $300 to $400, you will have a professional walk your property, compare it to others nearby, and provide either a number or range for your home’s worth. This will assure you that your asking price is fair. As a bonus, you can show the appraisal to all potential home buyers! If you want a quick sale, choose an asking price just under the appraisal (or at the low end) and if you’re willing to wait for the right buyer, choose an asking price equal or close to the appraisal value. For homes selling for more than $200,000, an appraisal is a very smart and small investment, relative to the home’s value.

Use the Federal Housing Finance Agency House Price Index Calculator

To help you determine a starting point for the asking price, try using the link below. This federal website gauges the value of your home based on the original purchase price and date, and uses average appreciation rates reported for your state or metropolitan area. If your home is in a metropolitan area, use the metropolitan area method (MSA/MSAD) rather than the state method to better assess its value.


When you arrive at an asking price, go visit other homes for sale in your area similar to your asking price and ask yourself, “Which would I like better? Mine or one of the others?” Or better yet, have a friend accompany you to offer an unbiased opinion. This will help insure your price is in the right neighborhood.

Property Condition Disclosures

The Tennessee Residential Property Condition Disclosure Act (found here) requires sellers to disclose the condition of their property when offering it for sale, exchange, or lease with option to buy. Whether or not a real estate broker is assisting a seller with the sale, a Property Disclosure Statement, made in good faith, is given to the buyer or prospective buyer before a sales contract is signed. The Property Disclosure Statement lists any known material defects of the property and must be completed by the seller, not the agent for the seller and not a home inspector. The purpose of the disclosure statement is to fairly inform the buyer or prospective buyer of defects that he or she may not otherwise discover during an inspection or without having the benefit of living there for numerous years.

There are some common exceptions to the requirement for a Property Disclosure Statement, as follows:

  • If the owner has not resided in the property during the last 36 months before closing and
  • The property consists of five or more dwelling units.

What Defects Must Be Disclosed?

The disclosure statement must identify any material defects in the property about which the seller has knowledge. Any defects are not required to be remedied by the seller but can typically be used as a bargaining tool for a potential buyer. Tennessee’s legislature provides a model form within Tenn. Code Ann. § 66-5-202, which fulfills all the statutory requirements. A REALTOR, such as Home Sense, has a similar form.

Regardless of which form you use, it will contain several questions concerning various aspects of the home, ranging from your legal title (for example, whether any contractors have placed liens on the home after a payment dispute) to the condition of the plumbing system (for instance, whether the sewer lines or outdoor sprinkler system work). Remember, you are required only to check “Yes” or “No” if you actually know the answer to the question being asked. There is nothing wrong with checking “Unknown” if you truly do not know.

Beyond the questions contained in the disclosure form given to the buyer before the purchase contract is signed, Tenn. Code Ann. § 66-5-202  also requires certain specific disclosures to be contained in the purchase contract itself. You must disclose “the presence of any known exterior [water] well”; the results of any known “percolation test or soil absorption rate performed on the property”; the existence of a “sinkhole” on the property; and any known groundwater erosion causing a surface settling of soil, sediment, or rock, as these potentially-hazardous environmental conditions may influence a potential buyer.

There are certain issues you need not disclose. Like several other states, Tennessee has a  specific section of its statute that states sellers do not need to supply any information to potential buyers about whether or not prior residents were “afflicted with human immunodeficiency virus (HIV) or other disease which has been determined by medical evidence to be highly unlikely to be transmitted through the occupancy of a dwelling place.” Similarly, a seller does not need to disclose whether the property was the site of a homicide, felony or suicide. All of these topics might concern certain potential buyers, but the legislature acknowledges that they are not technically relevant to the sale.

Sellers are not required to hire professional services to complete the disclosure statement. According to  Tenn. Code Ann. § 66-5-201, a seller “shall not be required to undertake or provide any independent investigation or inspection of the property in order to make the disclosures.” For example, you are not required to hire a mechanical engineer to make sure that the HVAC system works before submitting the disclosure statement to the buyer or a home inspector to ensure your wiring is code-compliant. You only need to answer the questions on the disclosure form to the best of your personal knowledge pertaining to its condition. If you do provide the buyer with an expert report such as the inspection report of a licensed land surveyor or engineer, you are not liable for its contents. According to  Tenn. Code Ann. § 66-5-204, an owner “shall not be liable for any error, inaccuracy or omission” contained therein. It is up to a buyer whether to believe the expert’s report, or commission a report of their own.

Sellers Should Be Honest When Completing the Property Condition Disclosure

Tenn. Code Ann. § 66-5-201 requires that the seller make the disclosures in good faith and not try to intentionally mislead a prospective buyer. It would be reasonable for major defects to influence the price the buyer is willing to pay for the home. In the longer term, however, the law gives you important incentives to be fully honest. There are strict penalties against a seller if the buyer discovers an obvious undisclosed material defect after closing. According to  Tenn. Code Ann. § 66-5-208, the buyer has specific remedies for an owner’s misrepresentations. Damages include an action “for actual damages suffered as a result of defects existing in the property as of the date of execution of the real estate purchase contract….” This means that the buyer can recoup the costs of repairing or replacing whatever the material defect was. For example, if you failed to disclose a broken HVAC system, you could be liable for replacing the system, which could be several thousand dollars.

Beyond these fears of possible legal action, the benefit of honest disclosure is simple: It creates trust. If a seller tells a buyer about a problem, the buyer is more likely to want to do business with the seller. Could honesty lower the purchase price, or maybe even scare a buyer away? Maybe. But it could be that honesty today saves headaches tomorrow. Plus, being honest is the law.

Broker, REALTOR, Agent: What’s The Difference

It’s common to hear the terms “broker,” “REALTOR®,” and “agent” used interchangeably. But is there a difference? And are there different terms for residential vs. commercial real estate brokerage?


A real estate “agent” is a person who has taken and passed a real estate licensing course, and is in good standing with the licensing authority (for Tennessee, this is the Tennessee Real Estate Commission, or TREC). An “agent” almost exclusively conducts residential real estate transactions. Every real estate firm employs a “Principal Broker,” who is responsible for supervising all other agents of that firm. When a home seller wants his house listed, he may call an agent friend for the listing. That listing agreement is actually an agreement between the seller and the real estate firm, which is represented by a “Principal Broker,” not the agent. So, any commission paid to an agent is actually paid to the agent’s Principal Broker, then (typically in a lesser amount) to the agent who worked the listing. In fact, it is illegal for an agent to work independently and get paid directly from the sale of real estate; instead, the commission must be paid directly to the Principal Broker, then to the agent, who works under or for the Principal Broker. For tax purposes, agents are typically “self-employed” and work for or subcontract to the Principal Broker or real estate firm.


After an agent has been licensed for several years or engages in a certain amount of real estate transactions (depending on which state), he can apply for a broker’s license, which includes an additional licensing course and exam. Brokers are typically thought of as being more advanced in their field of work because of their additional licensing and in most cases, responsibility. In a residential real estate firm setting, although it certainly happens, it is uncommon for a real estate professional to acquire a broker’s license and continue working for a Principal Broker. Instead, the broker will likely become a Principal Broker at an existing firm or start his or her own firm.

Principal Broker

A “Principal Broker” is a broker who supervises a real estate firm. It may be the firm owner or the owner may hire a Principal Broker to run the firm. All agents and other brokers at the firm are supervised by the Principal Broker, who assumes significant responsibility for the actions of his or her agents. Typically, a Principal Broker spends time managing the other real estate professionals at his firm and may take on a few personal listings. However, most listings and transactions are worked by the agents.

In Tennessee, every agent, broker, and Principal Broker are bound by codes of conduct and ethics, such as refraining from discriminating based on certain protected classes, i.e., race, color, national origin, religion, sex, familial status or handicap.


A REALTOR® is an agent or broker who is a member of the National Association of REALTORS®. NAR members are instructed to adhere to non-discrimination of additional protected classes: sexuality preference/orientation and gender identity. REALTORS® are not necessarily more skilled than non-REALTORS®; however, most real estate professionals who engage in residential transactions are REALTORS®. This is because only a REALTOR® is eligible to acquire membership to a local Multiple Listing Service (MLS). So, since the MLS is typically the primary means of advertising new listings, and sellers typically want maximum exposure when they hire a professional, almost all residential real estate professionals are REALTORS® and can access the MLS.

Commercial Real Estate

It is uncommon for a REALTOR® to engage primarily in commercial real estate transactions. Commercial transactions are typically more detailed and quite different than residential transactions. If a homeowner wants his home sold, he typically will contact an “agent” or “REALTOR®.” When a commercial land or building owner wants his real estate sold, he typically will contact a “broker.” Brokers are much more common in commercial transactions and commercial firms typically contain either all brokers or associate brokers (similar to an “agent”) working towards their brokerage designation. Commercial firms will also have a Principal Broker, who commonly engages significantly in many transactions, alongside other brokers or associates at the firm.

Fair Housing Act Explained


What Housing Is Covered?

 The Fair Housing Act covers most housing. But in some circumstances, the Act exempts owner-occupied buildings with no more than four units, single-family housing sold or rented without the use of a broker, and housing operated by organizations and private clubs that limit occupancy to members.


What Is Prohibited?

 In the sale (or rental) of housing, no one may take any of the following actions based on race, color, national origin, religion, sex, familial status or handicap:

 Refuse to sell (or rent) housing.

  • Provide different housing services or facilities.
  • Deny a dwelling.
  • Refuse to negotiate for housing.
  • Make housing unavailable.
  • Set different terms, conditions or privileges for sale or rental of a dwelling.
  • Falsely deny that housing is available for inspection, sale, or rental.
  • Deny anyone access to or membership in a facility or service (such as a multiple listing service) related to the sale or rental of housing.
  • For profit, persuade owners to sell or rent (blockbusting).

 In Addition, it is illegal for anyone to:

Intimidate, threaten, coerce, or interfere with anyone exercising a fair housing right or assisting others who exercise that right.

  • Advertise or make any statement that indicates a limitation or preference based on race, color, national origin, religion, sex, familial status, or handicap. This prohibition against discriminatory advertising applies to single-family and owner-occupied housing that is otherwise exempt from the Fair Housing Act.

 For more information about the Fair Housing Act or if you think your rights have been violated, please visit

For the Home Seller:

 As a home seller or landlord, you have a responsibility and a requirement under the law not to discriminate in the sale, rental and financing of property on the basis of race, color, religion, sex, handicap, familial status, or national origin. You cannot instruct the licensed broker or salesperson acting as your agent to convey for you any limitations in the sale or rental because the real estate professional is also bound by law not to discriminate. Under the law, a home seller or landlord cannot establish discriminatory terms or conditions in the purchase or rental; deny that housing is available, or advertise that the property is available only to persons of a certain race, color, religion, sex, handicap, familial status, or national origin.

For the Home Seeker:

 You have the right to expect that housing will be available to you without discrimination or other limitations based on race, color, religion, sex, handicap, familial status, or national origin. This includes the right to expect:

  • Equal professional service
  • Housing in your price range made available to you without discrimination
  • The opportunity to consider a broad range of housing choices
  • No discriminatory limitations on locations or communities of housing
  • No discrimination in the financing, appraising, or insuring of housing
  • Reasonable accommodations in rules, procedures and practices for persons with disabilities
  • Non-discriminatory terms and conditions for the sale, rental, insuring, or financingof a dwelling
  • To be free from intimidation or harassment for exercising your fair housing rights.

Home Sense’s Involvement

Agents in a real estate transaction are prohibited by law from discriminating on the basis of race, color, religion, sex, handicap, familial status, or national origin. A request from the home seller or landlord to act in a discriminatory manner in the sale, lease or rental cannot legally be fulfilled by the real estate professional.

Home Sense is a member of the National Association of REALTORS and is bound by its code of ethics. Article 10 of the National Association of REALTORS Code of Ethics provides that, “REALTORS shall not deny equal professional services to any person for reasons of race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity. REALTORS shall not be parties to any plan or agreement to discriminate against a person or persons on the basis of race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity. REALTORS, in their real estate employment practices, shall not discriminate against any person or persons on the basis of race, color, religion, sex, handicap, familial status, national origin, sexual orientation, or gender identity.” 

Real Estate Industry Facts

The National Association of REALTORS has compiled some interesting statistics:

Overview of the Real Estate Market


  • 5,250,000 existing homes were sold in 2015, according to data from the National Association of REALTORS. 510,000 newly constructed homes were sold in 2015, according to the U.S. Census Bureau.
  • The Association of Real Estate License Law Officials (ARELLO) estimates that there are about 2 million active real estate licensees in the United States.
  • According to the 2012 Economic Census, there are 86,004 real estate brokerage firms operating in the United States.
  • Preliminary results from the U.S. Energy Information Administration’s Commercial Buildings Energy Consumption Survey (CBECS) show that there were 5.6 million commercial buildings in the United States in 2012, comprising 87.4 billion square feet of floorspace.
  • There are approximately 115 million occupied housing units in the United States, according to the 2013 American Housing Survey. The typical owner-occupied home was built in 1976; the typical renter-occupied home was built in 1973. The typical home size is 1,500 square feet. The typical home owner is 55 years old, and has lived in the current home for 14 years.
  • In 2013, 65.2 % of families owned their primary residence, according to the Federal Reserve’s Survey of Consumer Finances.

REALTOR Demographics

  • 65% percent of REALTORS are licensed as sales agents, 22% hold broker licenses, and 15% hold broker associate licenses.
  • The typical REALTOR is a 53-year-old white female who attended college and is a homeowner.
  • 63% of all REALTORS are female, and the median age of all REALTORS is 53.
  • Real estate experience of all REALTORS (median): 10 years
  • Median tenure at present real estate firm (all REALTORS): 4 years
  • Most REALTORS worked 40 hours per week in 2016.
  • The median gross income of REALTORS was $42,500 in 2016, an increase from $39,200 in 2015.
  • Formal education of REALTORS:
    • Some college: 31%
    • Bachelor’s degree: 31%
    • Graduate degree and above: 13%
    • Associate degree: 12%
    • Some graduate school: 6%
    • High school graduate: 7%
  • REALTOR affiliation with firms:
    • Independent contractor: 86%
    • Employee: 5%
    • Other: 9%

Home Buyer Statistics

  • First-Time vs. Repeat Buyers:
    • First-time buyers: 35%
    • Median age of first-time buyers: 32
    • Median age of repeat buyers: 52
    • Median household income of first-time buyers: $72,000
    • Median household income of repeat buyers: $98,000
  • The typical home purchased in 2015 was 1,900 square feet in size, was built in 1991, and had three bedrooms and two bathrooms.
  • Among those who financed their home purchase, buyers typically financed 90% of the home price.
  • 88% of buyers purchased their home through a real estate agent or broker—a share that has steadily increased from 69 percent in 2001.
  • Buyers who definitely would use same agent again: 73%
  • Where buyer found the home they purchased:
    • Internet: 51%
    • Real estate agent: 34%
    • Yard sign/open house sign: 8%
    • Friend, relative or neighbor: 4%
    • Home builder or their agent: 2%
    • Directly from sellers/Knew the sellers: 1%
    • Print newspaper advertisement: 1%
  • 78% of home buyers surveyed in NAR’s 2013 Community Preference Survey responded that neighborhood quality is more important than the size of the home.  57% would forego a home with a larger yard in favor of a shorter commute.
  • NAR’s 2013 Profile of Buyers’ Home Feature Preferences found that the feature that had the highest dollar value buyers were willing to pay more for was a waterfront property.  53% of home buyers undertook a home improvement project within 3 months of buying, typically spending $4,550 in improvement projects.

Home Seller Statistics

  • The typical home seller in 2015 was 54 years of age, had a median household income of $100,700, and lived in their home for 10 years.
  • 89% of sellers were assisted by a real estate agent when selling their home.
  • Recent sellers typically sold their homes for 98% of the listing price, and 37% reported reducing the asking price at least once.
  • The typical home sold is on the market for 4 weeks.
  • 64% of sellers who used a real estate agent found their agents through a referral by friends or family, and 25% used the agent they previously worked with to buy or sell a home.
  • Sellers who “definitely would” use same agent again: 70%

For Sale By Owner (FSBO) Statistics

  • FSBOs accounted for 8% of home sales in 2015. The typical FSBO home sold for $185,000 compared to $240,000 for agent-assisted home sales.
  • Most difficult tasks for FSBO sellers:
    • Getting the right price: 18%
    • Preparing/fixing up home for sale: 13%
    • Understanding and performing paperwork: 12%
    • Selling within the planned length of time: 3%
    • Having enough time to devote to all aspects of the sale: 3%

Source: 2016 National Association of REALTORS Profile of Home Buyers and Sellers

Selling a Home As Is

We’ve all heard it. Some of us may fear it… the ole “As is” listing, or “Fixer upper.” It’s often associated with a home that is for sale with a few warning flags:

  • For whatever reason, the seller is not interested in upgrading or repairing the home in advance of its sale and the asking price may already reflect the condition of the home.
  • Deferred maintenance may signal hidden problems that will be uncovered only upon inspection. For example, leaky plumbing can rot floor joists, so an outdated bathroom may well need more than a new sink and toilet; it might need to be rebuilt from the plumbing up.
  • The home for sale needs updating, at the very least, and more likely, major repairs.
  • Maybe the home is eligible for “tear down” status.
  • Many “As is” homes were formerly rental homes, and the owner may be exempt from disclosing its condition.

“As is” homes are sometimes listed on common real estate websites but are more frequently found at government auctions.

Is an “As Is” Home a Bargain?

That depends on your intentions. Do you want to perform the essential fixes and then resell or “flip” the home for a profit? If so, it’s possible that an “As is” home could save the buyer thousands of dollars. But all prospective buyers who do not plan to tear down an “As is” home should get a thorough inspection conducted.

If you discover after the fact that problems are worse than you thought, the fact that the home was listed for sale “As is” means the buyer cannot retroactively get money for repairs. The seller advertised the home “As is,” so there is normally no recourse for repair expense reimbursement or sharing. Hidden problems often translate into costly repairs, which means a buyer should exercise caution when settling on a purchase price.

A buyer might find a vintage home with characteristics that outweigh the flaws that make it an “As is” sale and think that this is a great opportunity to polish a “diamond in the rough” for the buyer’s own home. So, buyers should do their homework on the expected home values in that neighborhood to determine if there exists a likelihood that the repair investment will be recouped.

Whether an “As is” home is bought for profit or as a personal project, a buyer should consider the following:

  • Have a top-ranked home inspector comb the home for structural, electric, plumbing and heating problems.
  • Ask the municipal building inspector to look over the home for illegal improvements that could require costly retrofitting and/or fines if discovered during subsequent home improvement projects.
  • Have a title insurer search public records for past-due tax and contractors bills that might be encumber the title; if you buy the home in an auciton setting, some or all lingering legal issues may become the buyer’s issues.
  • Get estimates from top-ranked contractors to verify your assumptions about how much it will cost to make any major repairs to the home.

Is Selling a Home “As Is” a Good Idea?

As a seller, do you want less hassle when it comes time to sell your home? If so, you may want to think about selling your home “As is.” Selling “As is” simply means putting the property on the market in its current condition, with few or no improvements. There are five primary reasons or benefits as to why sellers decide to sell a home “As is”:

1. Low Upfront Expense
“As is” sellers are not expected to spend money on pricey improvements, like updating the kitchen or bathroom, replacing the windows, or even repairing a non-code-compliant wiring system. Instead, an “As is” seller may choose to not make any repairs or opt to make minor upgrades, such as freshly painting a room or replacing a light fixture. Deciding on some inexpensive repairs may a good idea and could sell your home faster, depending on your situation, the home’s condition, and the buyer’s intention.

2.  Government- or Institutional-Owned Middle Tennessee Discount Realtor photo of USA capitol

As is” properties are very often seen at tax auctions, foreclosures, and HUD auctions. Homes in these cases are not typically owned and managed by the traditional person or family, but instead by a bank or government agency, which oftentimes are more interested in liquidating the home instead of gambling on repairs and payback.

3. Little Upfront Work
As an “As is” seller, you also don’t have to go to the trouble of clearing out your belongings, going into an organizing panic, or taking the time for a deep cleaning. With the proper disclosures concerning the state of the home, your marketing will not be any less effective, and the buyers may let you leave some or all of your unwanted belongings behind, but again, these conditions should be reflected in the price.

4. Estate Sale
When deceased parents leave their homes to their children, oftentimes the best way to divide the value of the property is by selling it and distributing the proceeds among the siblings. In such cases, when none of the beneficiaries have the time or money to recondition the home, it may be best to sell “As is” to realize the proceeds quickly.

5. Selling A “Tear Down”
When a property’s land is more valuable in an undeveloped condition than with the current house on the land, it is typically referred to as a “Tear down” and may be best suited for an “As is” transaction. It makes no sense to improve a home that will be torn down for a new structure or purpose.

Here are a few important things to keep in mind when a seller wants to sell a home “As is:”

Material Defects Have to Be Disclosed (where applicable)

All sellers, even if they plan to sell their home “As is,” are required to disclose known defects about the property and to provide information on any issues that a buyer may ask about, such as termite damage, a wet basement, non-working appliances, plumbing leaks, etc. Any defects discovered after the sale are the responsibility of the buyer unless the seller had previous knowledge. The most common exceptions to disclosure law are usually the sale of the decedent’s estate or a tax, foreclosure, sheriff’s sale, or a property in which the owner has not resided in the last 3 years

Buyers Can Negotiate for Repairs

An “As is” sale doesn’t mean buyers will not try to negotiate repairs. Home repairs are subject to negotiation regardless of what condition the home is in. A seller can opt to not make any repairs, but then the buyer has the right to void the contract, assuming there is a home inspection contingency in the purchase agreement and it is done within the timeline reflected in the contract.

The Home Needs to Be Priced Appropriately

If a buyer wants to avoid investing money on improvements, the asking price should typically be reduced by the amount it would cost for the future buyers to make the improvements. If the home is in poor condition or has not been updated, most buyers interested in the home will be investors or builders who will look to repair the home and flip it or tear it down and build a new structure. Real estate investors and builders may want to purchase an “As is” home even below the property’s current “As is” market value to ensure they make a profit on their investment. Low-ball offers are not uncommon, but if the seller has a good pricing strategy, he or she should not have to sell the home for less than what it is worth, even in “As is” condition.

Should I Market My Home as “As is?”

As discussed above, marketing a home as “As is” affects how it perceived (possibly as a seemingly inferior property).  Instead of listing a home “As is,” just omit the phrase altogether.  There is no need to inform potential buyers that you won’t be making any improvements or concessions… this can all be done during the offer negotiation stage.  Just make sure you have it priced correctly.

How To Choose A Closing Attorney

If you’re a home seller in Tennessee, quite likely any purchase offers you receive will list a closing attorney or title company as part of the agreement, because (1) traditionally, that’s the way residential real estate transactions in Tennessee work, and (2) the buyer usually pays for the title insurance. The closing attorney normally issues a title policy (insurance) and conducts and hosts the closing proceedings. So “closing attorney,” “title company,” and “escrow” all normally relate to the closing process. But just remember, everything in a purchase offer is negotiable, including who pays for the title insurance, where the closing is conducted, and which closing attorney is used. Also remember, the closing attorney will normally act as a “facilitator,” meaning the attorney represents no particular party’s best interest, but instead, is typically present to get the closing completed, rendering equal service to all parties involved.

As a seller, you may be entitled to a reduced title insurance rate if you use the same title company your home is currently insured with. So, it may benefit you to use that same title company, which again, is a bargaining point during offer negotiation. Or maybe you want to close at the title company located a few blocks from your house… again, a bargaining point.

Here are some things to consider when selecting a closing attorney:

  • Try not to use family members or close friends, as this could complicate personal relationships.
  • How many real estate closings has the title company (closing attorney) completed in the last month? Should be at least 15.
  • Look for positive feedback from online rating systems.
  • Are they available to answer questions during the closing process?
  • Are they currently too busy to fit your closing in at your specified closing date?
  • How much do they charge for their closing fee and title insurance?

What Does A Closing Attorney Do?

Whether buying, selling, transferring, or refinancing a home, a party may ask “What is a closing attorney and how is one selected?” A closing attorney, also known as a settlement attorney, typically provides “facilitator” service (does not represent one party) to the buyer, lender, seller, and broker(s) by ensuring that all parties involved in the real estate contract are served properly and that the contract is fully executed. Here are the basic functions of a closing attorney:

Title Examination/Search

The purchaser and lender will both want a clear title for the property before assuming ownership. Upon receipt of a real estate purchase agreement or a request from a bank or mortgage broker, the closing attorney will begin to verify the existing title to the property is valid and unencumbered. This examination is for the benefit of the purchaser and the lender to evaluate current, legal ownership of the real estate. The purchaser will need to know whether there are certain restrictions required for the property’s use, easements, encroachments or whether the title is marketable and clear for the seller to transfer to purchaser. The closing attorney will identify any existing mortgages against the real estate that will need to be satisfied at closing to transfer a clean title. The lender will want to have an overview of what liens, judgments and mortgages, if any, exist that must be addressed prior to or at closing so it can secure a first (top) lien position on the real estate, effectively removing or repositioning all other liens below the lender’s position. Also, the title examination provides the lender’s underwriters with opportunity to raise concern with the status of the title.


The closing attorney creates lines of communication between most parties for the real estate transaction. The closing attorney may converse with lenders, buyers, sellers, brokers, surveyors, merchants, parties that hold a judgment against the title, the seller’s mortgage holder (payoff request), the purchaser’s prospective homeowner’s insurance company, the county tax department, adjoining property owners, home inspectors, contractors, builders, developers, homeowner associations and other attorneys. The closing attorney must remain mindful of all the issues that must be addressed for the closing transaction to correctly reach its finality, but must also often communicate with multiple parties to coordinate the timely close of the transaction.

Title Insurance

Title insurance protects the purchaser and the lender should a future problem be discovered with the title. Once the title examination is completed, the closing attorney prepares an “opinion” on the title that is offered to a title company for the issuance of a title binder, which is preliminary to obtaining title insurance. Title insurance is a requirement for most all lenders at the time or purchase or refinance of real estate but is typically not required for transactions where no lender is involved. From the purchaser’s prospective, title insurance is highly recommended to insure the purchaser on the title, regarding claims of interests, rights and liens against the subject property being purchased. It is reasonably affordable and worth the expense. From the lenders perspective, it is a requirement because the lender seeks every assurance that it has secured its first lien position on the property, and the policy is there to stand behind that lien position. 

Review of documents

On the day of closing the closing attorney is present to review the various documents required for the real estate transfer. The closing attorney is available to explain documents such as a deed, a note, a deed of trust, a settlement statement, disbursement at the end of the transaction and loan documentation required by the lender.

Record and disburse

The closing attorney is responsible for closing on the transaction and distributing all monies. After review and execution of the necessary instruments of a real estate or loan closing, the closing attorney may check the local registry one last time to update the title, and records the deed and/or deed of trust. The closing attorney then issues a final opinion to the title company and pays the title company its premium. The closing attorney disburses any other fees and amounts associated with the transaction, to include any real estate brokerage fees, county taxes that are due and payable, payoff monies for existing loans, homeowner insurance premiums for the purchaser/borrower, pest inspection fees, appraisal fees, homeowner association dues, home inspector fees, the bank or mortgage broker’s fees, seller’s proceeds from sale and the attorney fees for closing.

Do Home Upgrades Pay Off?

To upgrade or not to upgrade. That’s a common question for the average home owner when time comes to sell. The two rooms that get the headlines are the kitchen and master bathroom. But if you do not realize greater than a 100% payback, then the investment was not worth it, right? Maybe, maybe not. An upgrade normally does two things to your home:

  • Makes the home more appealing physically to buyers
  • Generally, makes the home sell faster

Each of these has a dollar value. If your home sat on the market two extra months because the kitchen was not upgraded like similar, nearby homes, you may be paying an extra $4,000 in mortgage interest for those two months because your home didn’t sell quicker. So right off the bat, you’re in the hole $4,000 for having an outdated kitchen. For any upgrade, the time it takes to complete the upgrade and any mortgage interest you are paying during that period should both be considered, unless the upgrade is made without the intent to sell the home immediately.

If you’re ready to sell your home, but want to upgrade the bathroom, it may take one month for the upgrade. But, remember, you may be paying $2,000 in mortgage interest during that one month, so effectively you may be in the hole $2,000 immediately; for a home that takes two months for a kitchen rehab, that’s potentially a $5,000 mistake.  And what about the hassle of having your bathroom or kitchen out of service for a month or more? So, to avoid paying extra mortgage interest, it may be best to not perform upgrades just before you want to sell your home (especially if you have already moved out), but rather during the middle of your home ownership period, when you will have ample opportunity for your investment to repay itself due to overall home value appreciation and you are not paying a second housing expense.

But, what if the upgrade actually pays off by 110%, as advertised on numerous home shows and websites? On a $10,000 bathroom upgrade, that would be $1,000 extra in your pocket. Right? First, any return on investment is only an estimate by home professionals because the same home cannot sell at the same time with an un-rehabbed kitchen vs. a rehabbed kitchen. Still, let’s do a little math.

But then comes the wildcard: the DIYer. If you can legitimately do the upgrades yourself, you will likely experience a return on most upgrades. If you can paint a wall or roll out attic insulation, you may see a return on your investment of materials and supplies. If you can install kitchen cabinets, lay tile, replace a vanity sink, build a deck, or patch/install drywall, you may have discovered a new career: rehabbing homes. This type of DIYer commonly makes significant profit by flipping homes, and you can experience part of their success with your own home.

NOTE: DIYers should always consider local permitting and building code requirements.

Before you do any home improvements, consider your neighborhood, review and visit similar homes, and understand your target buyer. If most homes nearby have tidy, neat kitchens with Formica or laminate countertops, then your kitchen should too. If nearby homes have master bathrooms with marble, granite and designer showers, hopefully yours will too. Just be careful: over-improving your home compared to similar homes typically results in less payback for home buyers.Nashville Discount Realtor Home Sense kitchen photo

In summary, it’s hard to justify any major home improvement solely for the purpose of selling the home, unless you’re a seasoned DIYer and can save on the labor expense. Any time you must pay a professional at a professional labor rate and install new materials/fixtures/etc., you will likely not see a 100%+ return on your investment. What if your major upgrade was done to your taste, costs $20,000, was done professionally, but does not appeal to the typical home buyer? And what if you install a $2,000 farmhouse sink, but it doesn’t match the rest of your kitchen’s décor or the buyers do not value a farmhouse sink at $2,000? Just be careful with big-ticket upgrades. And consider hiring a competent interior designer.

Here’s the solution we offer:

Upgrades that can be quickly done by the home owner to appeal to the typical home buyer stand the best chance of returning more money than invested. So, what are the most likely upgrades that will pay off before selling a home?


Smart Upgrades:


A fresh coat of paint on your walls makes a splash. It’s an opportunity to cover up marks, stains, discoloration, etc. And if you choose a modern, neutral, lighter color, fresh paint can easily impress buyers. Look at homes online to see what colors are trending. Don’t assume your favorite color is everyone’s favorite color. Here are a few things to keep in mind when painting:

  • You don’t have to use the most expensive paint available; just be prepared for a second coat for inexpensive paints.
  • When using a lighter color over a darker color, it may require multiple coats.
  • Most trim, if it’s white, can easily be cleaned instead of having to repaint it. This is because trim normally has a glossier finish, allowing stains to be removed easier than flat finishes, such as on the walls.
  • A flatter paint finish for the walls will tend to hide wall imperfections much more than glossier finishes. But attempting to clean a flat-finished wall will normally cause the sheen to change, leaving an obvious mark.
  • Use water-based paints (latex) indoors and oil-based paints outdoors.
  • Consider buying your paint and supplies at a local second-hand outlet, such as Habitat Restore.

Prune/trim landscape

You don’t have to plant new shrubs or create an elaborate landscaping scheme, just make sure what you do have looks tidy. For trees and bushes located near the front of the home, ensure they are attractively trimmed and shaped. Spreading mulch can greatly enhance your landscape (check your local brush collection service; they may sell inexpensive mulch). For less than $150, you can create an inviting exterior that will maintain a buyer’s interest once they walk from their car to your front door. Finally, always make sure the grass is cut.

Front door

Just like the landscape, the front door needs to maintain the buyer’s interest. This is likely the first feature of your home the buyer will see up close. So, consider repainting the door and the surrounding trim. If your door is beyond repair, consider spending $150 to $300 on a new door. Even if you can’t replace it yourself, the labor for a professional installer will be relatively inexpensive. You may even find a deal at the hardware store that combines the door purchase with a free, or almost free, installation. Or you may find the right sized door at a second-hand store for $50.

Faucet/door knob/drawer pulls/light fixture upgrades

Gold light fixtures are long outdated, and brass is less popular than brushed nickel, unless dealing with a historic home. Replacing outdated ceiling fixtures and bathroom faucets can give your home a modern touch for a minimal investment. The same goes for drawer and cabinet pulls in the kitchen.

Kitchen appliances:

Here’s an important concept to remember: a home’s market value increases or decreases primarily due to the value of the property on which the home sits, not the home itself. Just like the new car depreciation concept, once you spend $1,000 on a new range, it does not automatically increase the value of your home by $1,000 because now it is a used range. If your kitchen appliances are outdated or not working properly, now might be a good time for replacement. But, just don’t buy a new appliance! Search for a scratch and dent model at a home furnishing store; they may even deliver it for free and charge a nominal fee for installation. Or, search and borrow a friend and truck. There are numerous lightly used or even unused appliances for sale locally that are far less expensive than a new model at a home furnishing store. Just keep in mind how you will dispose of your old appliance.

Paint or re-surface the kitchen cabinets

A fresh coat of paint and even a new color on your kitchen cabinets can change the tone of your entire kitchen. You’ll probably need to remove all the cabinet doors and drawers and this effort may take a weekend or two. If doing this upgrade, consider replacing the drawer pulls as well.

A second-hand outlet can supply you with new or lightly used paints and drawer pulls.


Upgrades for Seasoned DIYers:

The Kitchen

Remodeling the kitchen to introduce more light and openness will normally appeal to new buyers. Consider removing a wall between the kitchen and dining or living area, remove extra overhead cabinets that block the view, or convert a full-height wall into a half-height wall with columns between the kitchen and the adjoining living or dining area.

Modern families spend much of their time in the kitchen, and so an investment to improve the look and functionality of this popular room is typically a good one.The key: buy good quality appliances (preferably, barely used ones) and solid kitchen cabinets. But don’t go overboard. While the special wine cooler, high-tech trash compactor and supersize refrigerator may seem very special, few home buyers actually want to pay for them, especially if they are new. Most under-counter wine coolers cost $1,000 to $2,000 new, but a home buyer will not automatically value the home price at $2,000 more.

The Bathroom

If your home has several bathrooms, and you spend significant money to remodel the least-used one, you may not get the return you expect. A significant bathroom remodel works best on the master bath and/or the half bath used for guests.

New Windows

Upgrading your windows offers a solid payback for the same reasons as replacing a front door – new windows brighten up your home and improve insulation, cutting down on drafts and saving utility costs.

Exterior Finish

New siding not only makes your house look better, but it also promises to cut down on future maintenance issues. Modern vinyl siding is fade resistant and typically comes with 10-year+ warranties. Fiber cement siding and manufactured stone veneer are more expensive, but offer a high quality look that many future buyers will appreciate. Buyers will be delighted to see a fresh coat of exterior paint on a painted brick house.

New Garage Door

A bright new garage door, for a relatively modest cost, gives your garage a brand new face to the world, especially it is viewable from the street.

The Closing - What to Expect

A closing is a meeting at which a buyer gives a seller money in exchange for the deed. Most closings occur 60 to 90 days after the contract is signed.

Where will the closing be?

In Tennessee, a closing will normally be held at the title company’s office where the closing attorney resides, but it is not uncommon for closings to be held at a broker, lender, or other office. Details regarding the date, time and location of the closing are usually contained in the Purchase and Sale Agreement.

Who will be at the closing?

Generally, the buyer, seller and a closing attorney attend the closing; real estate agents or brokers are frequent attendees and it’s not uncommon for a representative of the title company to show up. Frequently, the buyer and seller will appear at different times.

If you’re the seller, you may opt to pre-sign documents and have an attorney or other representative attend the closing on your behalf. The buyer must sign all the bank documents at the closing and usually this is done in person.

What happens at closing?

The closing is a time for the buyer to review and sign numerous loan documents, disclosures, certifications, etc. This is when buyers must make sure they understand the terms to which they are agreeing. If terms differ from what you originally agreed to, you’ll need to resolve the issue before signing. The closing attorney should be able to explain each form requiring your signature.

What should you bring to closing?

In general, buyers and sellers should bring along a government-issued ID card, such as a driver’s license or passport. If you’re the buyer, you will also need to bring along a certified check or arrange for a wire transfer for the down payment and closing costs made out to the title or closing company.

If you’re the seller, you’ll want to bring all keys or codes for keyless entry, and a certified or cashier’s check made payable to the title or closing company, if these costs are not being deducted from the sales price.

What will your closing costs be?


In general, a seller or buyer will pay attorney fees, title insurance, brokerage commission fees, mortgage fees, short-term interest, tax pre-paid fees, local/state/federal taxes, and other related fees.

Lenders must give borrowers an estimate of their closing costs within several days after receiving a loan application. That document, called the Good Faith Estimate or Closing Disclosure, lists various mortgage fees and third-party expenses. Lenders may be liable for the difference if they grossly underestimate the costs that consumers can expect to pay. The title company will typically be in contact with the seller should the seller be responsible for paying out-of-pocket expenses at closing.

How long will closing take?

Most closings take two to three hours, depending on the complexity of the real estate being sold. Once everything has been signed, all the necessary documents will be filed, and the deed and mortgage will be recorded.