Tennessee mortgage and refinance rates

Current mortgage rates in Tennessee

As of Thursday, December 04, 2025, current interest rates in Tennessee are 6.25% for a 30-year fixed mortgage and 6.13% for a 15-year fixed mortgage. As in the rest of the country, Tennessee's mortgage rates have dwindled from their highs in 2023. But don't expect a return to their early pandemic lows. While it's difficult to predict mortgage rates, most experts believe rates will linger above 6 percent into 2026.

Mortgage rates in Tennessee will vary based on your location and credit scor and other factors like inflation. To get the best mortgage or refinance rate in Tennessee, be sure to shop around and compare offers from several different lenders.

Refinance rates in Tennessee

Refinance rates in Tennessee are higher than the historic lows of the pandemic era, which means a mortgage refinance may not appeal to many homeowners. However, if you locked in a rate at the height of the market in 2023, you might be able to refinance to a better rate soon if prevailing mortgage rates drop enough.

In addition, if you’ve owned your home for a long time and its value has increased substantially in the last few years, you could tap your home equity to further your financial goals. For example, you could do a cash-out refinance or get a home equity loan or line of credit to make updates to your home.

National mortgage rates by loan type

Tennessee housing statistics and trends

 Though Tennessee's overall median sales price is below the national median of $410,800, the state's major cities have prices closer to or above that figure. However, median sales prices are dropping, while days on the market and the percentage of homes with a price drop since they were initially listed have both grown since 2024. Both are signs of a market becoming friendlier to buyers. If you’re buying a home in the Volunteer State, here are some more stats to know:

• Median home sales price, September 2025: $391,300
• Median home value, August 2025: $309,336
• Median down payment, August 2025: $56,400
• Median days on market, September 2025: 65
• Percentage of homes sold above list price, September 2025: 14%
• Percentage of homes with price drops, September 2025: 29%
• Homeownership rate, Q1 2025: 69.4%

Sources: ATTOM, Redfin, U.S. Census Bureau

Mortgage options in Tennessee

• Tennessee conventional mortgages: To qualify for a conventional mortgage, you’ll need a minimum credit score of 620 and a debt-to-income (DTI) ratio of no more than 45 percent. With a down payment of less than 20 percent, you’ll need to pay private mortgage insurance (PMI), as well.
• Tennessee FHA loans: If your credit history disqualifies you from a conventional mortgage, you might be able to obtain a loan insured by the Federal Housing Administration (FHA). If you have a down payment of at least 3.5 percent, you could qualify for this type of loan with a credit score as low as 580. 
• Tennessee VA loans: If you’re a veteran or active-duty member of the military, you might qualify for a mortgage guaranteed by the Department of Veterans Affairs (VA). A VA loan doesn’t require a down payment or mortgage insurance, but you do need to pay a funding fee, which ranges from 1.25 to 2.15 percent for the first use.
• Tennessee USDA loans: If you’re buying a rural property in Tennessee, you might be eligible for a mortgage guaranteed by the U.S. Department of Agriculture (USDA). These loans don’t require a down payment, but you’ll need to purchase in a designated rural area and meet the area’s income limits.

First-time homebuyer programs in Tennessee

In addition to conventional loans and FHA loans, the Tennessee Housing Development Agency (THDA) offers a handful of programs designed to assist first-time homebuyers:

• Great Choice Home Loans: The Great Choice Home Loan program is aimed at moderate-income buyers. It offers 30-year fixed-rate mortgages to those with credit scores as low as 640. The program comes with household income and purchase price limits, which vary by county, as well as down payment assistance. Borrowers can pair it with Great Choice Plus down payment assistance to borrow up to 100 percent of a home's cost.
• Homeownership for Heroes: In terms of features, the Homeownership for Heroes program — available to members of the military and law enforcement, paramedics, and firefighters — is very similar to Tennessee's Great Choice Home Loan for first-time homebuyers. It offers a 30-year fixed interest rate and has a minimum 640 credit score requirement. Interest rates through Homeownership for Heroes are reduced a half-percentage point; the requirement that you be a first-time homeowner to participate is waived; and buyers are able to borrow as much as 100 percent of a property's purchase price with a VA or USDA loan, and 96.5 percent with an FHA loan.
• Take Credit MCC Program: The Take Credit Mortgage Credit Certificate (MCC) provides a federal income tax reduction for those who purchase a property in one of the state’s Targeted Areas. In addition to first-time homebuyers, Take Credit MCC is open to veterans or repeat homebuyers, as long as the property is located in one of the state’s qualifying Targeted Areas. MCC participants are eligible for a federal tax credit of as much as $2,000 annually, which can be used to decrease the homebuyer’s income tax liability year after year, as long as the house remains the primary residence.

How to find the best mortgage rate in Tennessee

Additional Tennessee mortgage resources

• Tennessee loan limits by county: Learn the loan limits for FHA and conventional loans at the county level.
• Tennessee mortgage lenders: Explore mortgage lenders in your state.
• How to buy a house in Tennessee: Get set up for a successful house hunt with this guide.
• Homeowners insurance in Tennessee: Read all about the ins and outs of protecting your property. 
• Mortgage calculator: Estimate how much you’ll pay each month and how much interest you’ll pay over the entire loan.