Tennessee House Bill HB0137

Tennessee 2025-2026 Regular Session

• Introduced: 1/13/25

Caption

AN ACT to amend Tennessee Code Annotated, Title 56, Chapter 35 and Title 66, relative to real property transactions.

Summary

HB0137 would give the purchaser or borrower in a Tennessee real property transaction the exclusive right to choose the settlement agent, subject to any approval rights held by a mortgage lender, mortgage loan broker, or mortgage loan servicer. The chosen settlement agent would be the only party authorized to provide escrow or closing services, act as the title insurance agency, and perform the title-clearing functions needed for the transaction under the title insurer’s underwriting rules. The bill also prohibits sellers from requiring buyers to use a particular settlement agent, and it makes those buyer-selection protections nonwaivable and nonmodifiable by contract. At the same time, it preserves a seller’s ability to retain a licensed attorney for limited representation related to deed preparation, fee negotiation, review and signing of closing documents, and legal advice about the escrow or closing process. If a seller is represented by counsel, the settlement agent may not charge certain fees to the seller or related entities without the seller’s attorney’s written consent, except for title-clearing charges.

Impact

HB0137 would amend Tennessee Code Annotated Title 56, Chapter 35, adding a new section governing settlement-agent selection in real property transactions and affecting how closing, escrow, and title insurance services are arranged. It would limit seller-imposed closing requirements, strengthen buyer/borrower control over the choice of settlement agent, and create a statutory rule that cannot be waived or altered by the parties. The bill would also interact with existing title insurance and real estate closing practices by defining the settlement agent’s exclusive role in the transaction.

Sentiment

There is no recorded committee discussion or vote history provided for HB0137, so the available context does not show direct support or opposition from legislators. Based on the bill text alone, the measure appears designed to protect consumer choice in real estate closings while preserving limited seller legal representation, suggesting a consumer-protection orientation rather than a punitive or regulatory enforcement approach.

Contention

The main potential point of contention is the bill’s restriction on sellers’ ability to require a particular settlement agent, which may be viewed by some real estate or title industry participants as limiting transaction flexibility or established business relationships. Another likely issue is the nonwaivable nature of the buyer-selection rule, which removes private contracting discretion. On the other hand, the bill explicitly preserves a seller’s right to hire an attorney for limited closing-related representation, indicating an effort to balance consumer choice with seller protections.