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Tennessee Hard Money and Investor Loans
Tennessee taxes the deed and the note. We price both into the file.
USA Mortgage funds investors across Tennessee. This page is the state layer: closing taxes, the interest ceiling, how a deed of trust forecloses, and what the assessor does with your parcel. For what a specific market is doing, go to the metro page. Business-purpose loans only, and every structure is set in underwriting.
We underwrite in house, so you get a term sheet the same day.
The state layer, not a market average
Closing taxes, the interest ceiling, foreclosure and the assessor. Market conditions live on the metro pages.
Direct lender, no broker
We underwrite and fund in-house. No middle layer slowing down your close.
Every investor strategy
Flips, rentals, new construction, bridge, and portfolio loans, all under one roof.
Loan programs in Tennessee
Acquisition through exit, all funded or arranged by one lender.
Tennessee lending questions
Do you lend across all of Tennessee?
Yes, statewide, on business-purpose loans only. Tennessee draws its residential mortgage licensing line at the purpose of the loan, not at the borrower. TCA 45-13-105 defines a residential mortgage loan as one made primarily for personal, family or household use, so a genuine business-purpose loan sits outside that chapter whatever the collateral. Note the trap: unlike some neighbouring states, titling in an LLC does not by itself put a Tennessee loan outside the residential chapter, and Tennessee runs a second gate, the Industrial Loan and Thrift Companies Act at TCA 45-5. Our Tennessee lending is structured with counsel. We fund in Nashville, Memphis, Knoxville, Chattanooga, Murfreesboro, Franklin, Clarksville and Johnson City. For market conditions rather than state law, start with Nashville. Subject to underwriting.
What does Tennessee actually charge me at closing?
Two state taxes, and you pay both. Tennessee taxes the conveyance and the debt separately. The realty transfer tax is $0.37 per $100 of the greater of consideration or value, and by statute the grantee, meaning the buyer, pays it. The indebtedness tax is $0.115 per $100 of debt with the first $2,000 exempt, and the mortgagor pays it while the note holder collects and remits. On a $400,000 purchase with a $300,000 loan that is $1,480 on the deed (400,000 / 100 x 0.37 = 1,480) plus $342.70 on the note (298,000 / 100 x 0.115 = 342.70). Every recorded debt instrument carries the legend stating the maximum principal indebtedness for Tennessee recording tax purposes. Investors coming from a cheap-recording state are usually surprised, so put both lines in the model before you write the offer.
Does Tennessee cap what a private lender can charge?
Yes, and Tennessee has no business-purpose or entity escape hatch. TCA 47-14-103 sets the ceiling by the form of the transaction, not by the borrower or the purpose, so a loan to a Tennessee LLC sits under the same cap as a loan to an individual. For a written contract the ceiling is the formula rate at TCA 47-14-102: four percentage points above the published average prime loan rate, or 24 percent per year, whichever is less. On top of that, TCA 47-14-113 polices fees, limiting loan charges to fair and reasonable compensation for an expense actually incurred or a service actually rendered, and barring charges for the lender's own overhead and loan losses except as part of interest. That is the rule. We do not publish a rate here, and we would be suspicious of anyone who does. Your pricing comes from underwriting on your file.
How does foreclosure work in Tennessee, and why does that matter to a borrower?
Non-judicially, under a deed of trust, and it is one of the cleaner remedies in our footprint. There is no clerk's hearing and no upset-bid period. TCA 35-5-101 requires advertisement at least three different times in a newspaper published in the county, with the first publication at least 20 days before the sale, and the trustee must mail the debtor a copy by registered or certified mail, return receipt requested, on or before the first publication date. TCA 35-5-104 controls what the notice must contain, including a legal description with deed book and page and any federal or state tax lien. Tennessee foreclosures fail on defective descriptions and missed lien notices far more often than on timing. The old 60-day pre-foreclosure notice expired on January 1, 2013 and secondary sources still repeat it. Call it roughly three weeks of statutory notice from first publication to sale, and treat any months-long timeline you read online as unsourced.
Tennessee has no income tax, so my entity pays nothing here, right?
Wrong, and this is the most common Tennessee mistake we see. The individual side is genuinely clean: the Hall income tax was repealed for tax years beginning on or after January 1, 2021, so there is no wage tax and no state capital-gains tax. But franchise and excise tax reaches the entity. Corporations, LLCs, LPs and business trusts chartered, qualified or registered in Tennessee, or doing business here, owe excise at 6.5 percent of Tennessee net earnings and franchise at 0.25 percent of net worth with a $100 minimum, payable even by an inactive registered entity. Sole proprietors and general partnerships are not subject. There is a family-owned non-corporate entity exemption with real limits, covered on our Tennessee DSCR page. Confirm your own position with a Tennessee CPA.
What happens to my tax bill when the county reappraises?
Less than you fear, because Tennessee makes the county reset the rate. Counties reappraise on a continuous six-year cycle, or a four-year cycle with State Board of Equalization approval, or a five-year cycle if the assessor agrees and the county legislative body votes it. Values are frozen between reappraisals, and there is no acquisition-value reset when you buy, so a Tennessee purchase is not reassessed to your price the way a California one is. After a countywide reappraisal the county computes a certified tax rate that raises the same total revenue as the prior year on the new values, and to adopt a rate above it the governing body must publish notice, hold a public hearing, and file with the State Board. So a 30 percent jump in assessed value does not mechanically mean a 30 percent bigger bill. What you eat is whatever the county votes above certified, plus how your parcel moved against the county average. Check your county's cycle and current-year dates rather than reusing last year's.
Does Tennessee look the same across the state?
No. Three grand divisions, and the differences are real. West Tennessee around Memphis, Middle Tennessee around Nashville, and East Tennessee around Knoxville and Chattanooga each run their own county assessors, their own reappraisal cycles, and their own local rates, and property tax here is entirely a county and municipal levy with no state property tax. Inside a city a parcel pays both. We underwrite all three divisions on the same programs, but we price the tax and insurance lines parcel by parcel. For what a market is actually doing, read the metro page rather than a statewide average: Nashville, and Nashville fix and flip for the flip side of it. Subject to underwriting.
What credit score do I need to borrow in Tennessee?
It depends entirely on the program. On our asset-based loans, meaning fix and flip, bridge and ground up construction, there is no minimum score. We run credit, but it carries far less weight than it would at a bank, and weaker credit is usually answered with lower leverage rather than a decline. DSCR and bank statement loans start at 640, conventional investment starts at 580, and transactional funding runs with no credit check at all. There is no hard credit pull to open a Tennessee file. Subject to underwriting.
What is the smallest loan you will write in Tennessee, and how much do I put down?
$100,000 on most residential programs, and anywhere from nothing to 30 percent down. Fix and flip, DSCR and bank statement loans all start at $100,000. Portfolio loans start at $500,000 across five or more properties, and SBA starts at $350,000. At the top, fix and flip and construction run to $5,000,000, DSCR and bank statement to $3,000,000, and commercial bridge to $10,000,000. On leverage, fix and flip funds up to 90% of purchase plus up to 100% of rehab, so on a $300,000 Tennessee purchase that is $270,000 from us and $30,000 from you (300,000 x 90% = 270,000). DSCR and conventional investment run up to 80% LTV, commercial bridge up to 75%, construction up to 70% of value and 85% of cost, and transactional funding covers up to 100% of the A-to-B purchase. Subject to underwriting.
Serving Tennessee and nearby
NashvilleMemphisKnoxvilleChattanoogaMurfreesboroFranklinClarksvilleJohnson City
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About the local figures on this page
Local rules move. Every tax rate, fee, ordinance and market figure here comes from a primary source and carries the date we read it, and we correct them as the rules change. Where a number is mid-change or we could not verify it, we say so rather than guess. Before you commit a budget, confirm anything that drives it with the city or county, and talk to your attorney or CPA on questions of law or tax.
Published by USA Mortgage Funding, LLC, NMLS #152588. Researched from primary sources by our team, drafted with AI assistance, and every figure checked against its source before publishing. Where an answer rests on a public record, that record is linked under it. Figures read on 2026-08-23.
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