Conventional Home Loans in Tennessee
From East Nashville to Germantown, conventional is the loan most Tennessee buyers end up comparing everything else against: 3 percent down to start, mortgage insurance that cancels as equity grows, and a $832,750 limit that covers most of the state. Tennessee’s recordation tax rides on every mortgage, so it is in our quotes from the first estimate. Licensed in all 95 counties.
Tennessee Mortgage License 218217. NMLS #1925352.
Conventional in Tennessee, 2026
Conforming limit
$832,750 in every Tennessee county
Down payment
From 3% for eligible buyers; 10% second home; 15% rental
Mortgage insurance
Cancellable at 80% of original value, none from 20% down
Recordation tax
$0.115 per $100 of the loan above $2,000
Closing
Title company or attorney; no attorney requirement
3%
Minimum down payment on a first home
$0.115
Recordation tax per $100 of the loan
95
Tennessee counties, licensed statewide
4.9
Average of 5,300+ Google reviews
The benchmark loan in a fast-growing state.
Tennessee’s growth markets, Nashville and its ring counties, Knoxville, Chattanooga, run mostly on conventional money: 3 percent down for eligible buyers on some programs, commonly 5, a 620 floor with the best pricing from about 740, and the $832,750 conforming limit covering all but the top of the market. The mortgage insurance is temporary by rule: request cancellation at 80 percent of the original value, automatic termination at 78 percent while the loan is current, no premium at all from 20 percent down.
The state’s fingerprints on the bill are two Nashville-grade facts: the recordation tax, $0.115 per $100 of the mortgage above the first $2,000, paid whenever a mortgage records, purchases and refinances alike; and on purchases the transfer tax, $0.37 per $100 of the price, customarily the buyer’s. A title company or an attorney can close, your choice, and mobile notaries are routine.
This page covers conventional loans in Tennessee. For the state as a whole, see our Tennessee page; the conventional hub explains the program itself. FHA in Tennessee is the lower-score comparison, and buying in Tennessee and refinancing in Tennessee cover the transactions end to end.
Conventional guidelines, and what Tennessee adds.
The first two columns are the Fannie Mae and Freddie Mac rules every lender starts from; the last is the Tennessee layer. Your pro confirms which apply to your file.
| Requirement | Guideline | In Tennessee |
|---|---|---|
| Down payment | As little as 3% on some programs for eligible buyers, commonly 5%; 10% second home; 15% rental | Lake and Smokies second homes are financed this way; cabin rentals price as investment |
| Credit score | Usually 620; best pricing from about 740 | Same statewide; the score sets the rate and the mortgage insurance premium |
| Mortgage insurance | Required under 20% down; cancellable at 80% of original value, automatic at 78% while the loan is current | Middle Tennessee appreciation has retired many premiums ahead of schedule |
| Loan limit | $832,750 for one unit in 2026 | Every county; Belle Meade, Franklin and the lakefronts cross into jumbo |
| Seller contributions | 3% of the price with under 10% down, 6% with 10% to 25%, 9% above that | Often negotiated toward the transfer and recordation taxes |
| Debt-to-income ratio | Up to about 45 to 50% with strong compensating factors | No state wrinkle; HOA dues count where they exist |
Guidelines are Fannie Mae and Freddie Mac’s; individual lenders can be stricter. The limit is the FHFA figure for 2026 and resets each year.
Three ways Tennesseans use conventional.
One program, three different files. All three close at a Tennessee title company or attorney’s office.
From 3% down
Buying a home
Eligible buyers can start at 3 percent down on some programs, most at 5, from Murfreesboro starter homes to Signal Mountain. From 20 percent down there is no mortgage insurance line at all.
Drop FHA MI
Refinancing out of FHA
FHA’s premium runs for the life of the loan below 10 percent down. Once equity passes 20 percent, a conventional refinance removes it for good; the recordation tax on the new loan goes into the break-even before you commit.
Second homes and rentals
The lakes and the Smokies
A Tims Ford or Norris Lake place from 10 percent down, a Gatlinburg-area cabin that rents as an investment from 15. How the home will be used sets the pricing, and we ask early.
Score-based pricing decides the FHA question here.
At Tennessee’s price points the FHA-versus-conventional choice is usually decided by the credit score, because conventional’s mortgage insurance prices by score while FHA’s does not. From the high 600s up, conventional’s premium is usually smaller, it cancels at 80 percent of the original value, and it was never joined by an upfront premium the way FHA’s 1.75 percent is. Below that range, FHA often wins the monthly math.
We settle it the boring way: both loans priced on one page, with the recordation tax, title and closing fees identical on each side, so the only difference showing is the one that matters. Then the better loan wins, whichever hub page it belongs to.
Memphis to the Smokies
Conventional purchases and refinances closed at a Tennessee title company or attorney’s office near you, in all 95 counties.
Six Tennessee details on a conventional file.
The state-level facts that shape cost and timing. All of them appear on your Loan Estimate from the start.
01
Recordation tax
$0.115 per $100 of the mortgage above the first $2,000, paid whenever a mortgage records: about $430 on a $375,000 loan, purchases and refinances alike.
02
Transfer tax on purchases
$0.37 per $100 of the price on the deed, customarily the buyer’s line in Tennessee. It never applies to a refinance, because no deed is recorded.
03
Closing your way
A title company or an attorney can close; most files use a title company, and mobile notaries bring the signing to your kitchen table.
04
Property taxes in arrears
County and city bills arrive in the fall. Purchase closings prorate them, and the new escrow picks up from there; refinancing does not change the assessment.
05
Appraisal waivers happen
On strong files with plenty of equity the agencies sometimes waive the appraisal, which saves money and days. We tell you if your file qualifies.
06
The rescission period on refinances
When a refinance is secured by your principal residence, federal law gives you three business days to cancel, counted under federal rules from closing and delivery of the required notices; the payoff funds on the fourth. A second home or rental has no waiting period.
What would a conventional payment look like?
Set the price and your down payment. Under 20 percent down, add the mortgage insurance estimate; closing costs should include the recordation tax and, on a purchase, the transfer tax.
The U.S. conventional market right now.
National average rates from the Federal Reserve Bank of St. Louis FRED database: the Freddie Mac survey for conventional and the Optimal Blue indices for FHA and VA, shown as third-party market benchmarks, not MortgagePros pricing. Your rate and APR depend on your credit, down payment, property type and the day you lock.
Conventional 30-year fixed, U.S. average
7.40%
FHA 30-year fixed, U.S. average
7.18%
VA 30-year fixed, U.S. average
7.09%
Sources: Freddie Mac Primary Mortgage Market Survey (conventional, 30-year national average, week of Oct 8, 2026) and Optimal Blue Mortgage Market Indices (FHA and VA, 30-year national averages as of Oct 8, 2026), distributed through FRED, Federal Reserve Bank of St. Louis; the figures and dates refresh automatically from the source. These are third-party market benchmarks, not MortgagePros rates and not an offer of credit. Your rate and APR depend on your credit, loan type, property and lock date.
How a conventional loan works with us in Tennessee.
Four steps, one licensed pro, a Tennessee closing near you.
1
The numbers first
Price or current loan, down payment or equity, and the whole payment with taxes, insurance and any mortgage insurance, the state taxes itemized.
2
The right structure
Down payment against pricing tiers, mortgage insurance options side by side, FHA priced on the same page where the score makes it close.
3
Underwriting and appraisal
Documents in early, the appraisal ordered where one is needed, conditions cleared as they come in.
4
Close near home
Title company or attorney, your choice, or a mobile notary. The recordation tax appears on the closing statement exactly as quoted.
Ready to price a conventional loan in Tennessee?
A Tennessee-licensed pro shows you the payment, the mortgage insurance options and every state tax on one page. Free, and it starts without a hard credit pull.
Conventional loans in Tennessee, answered.
The questions Tennessee borrowers ask us most. If yours is not here, a licensed pro will answer it directly, with no obligation.
What does a conventional loan cost to close in Tennessee?
The lender’s fees, title insurance, the closing agent’s fee, an appraisal where one is required, prepaid interest and escrow deposits, plus the recordation tax at $0.115 per $100 of the loan. On a purchase, the transfer tax at $0.37 per $100 of the price is customarily the buyer’s as well. Everything is itemized on the Loan Estimate.
What credit score do I need?
Most lenders start at 620, with the best pricing from about 740. Below roughly 680 we price FHA beside conventional, because FHA’s mortgage insurance does not climb with the score the way conventional’s does, and the recordation tax is the same either way.
When does mortgage insurance come off?
Request cancellation at 80 percent of the original value, automatic termination at 78 percent while the loan is current, and none at all from 20 percent down. Middle Tennessee’s appreciation has carried many recent buyers past those marks early, and some servicers allow cancellation based on current value under additional conditions; ask before refinancing.
Can I finance a Gatlinburg cabin with a conventional loan?
Yes, and the use decides the terms: a true second home starts at 10 percent down, while a cabin bought to rent prices as an investment property from 15 percent down, with the projected rents documented. We ask the use question first because it changes both the rate and the paperwork.
When is a loan jumbo in Tennessee?
Above $832,750 for a one-unit home in 2026, in every county. Belle Meade, Franklin, Brentwood and the lakefront markets cross the line regularly; jumbo in Tennessee covers those files, including how the recordation tax scales with the loan.
Do I have to come to Michigan?
No. Your licensed pro handles the loan by phone, email and e-signature, and the closing happens at a Tennessee title company or attorney’s office near you, or with a mobile notary.
Talk to a Tennessee-licensed pro about a conventional loan.
Tell us what you are looking to do and where in Tennessee. A licensed pro will call back, usually the same business day. Asking does not start a loan or require a hard credit pull.
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248-416-1361
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Visit our office
880 W. Long Lake Rd, Suite 300
Troy, Michigan 48098, just off I-75. Free parking.
Licensed and reviewed
Tennessee Mortgage License 218217. NMLS #1925352. Rated 4.9 across 5,300+ Google reviews.