State Buyer Guide

First-Time Home Buyer Guide
for Tennessee

Down payment assistance, Tennessee housing programs, closing cost estimates, and what to know before buying — including from FSBO sellers.

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$335,000
Avg Home Price
0.64%
Property Tax Rate
~$7,705
Est. Closing Costs
0.37% ($3.70 per $1,000)
Transfer Tax

Tennessee Housing Finance Agency Programs

The Tennessee Housing Development Agency (THDA) is your primary source for below-market mortgage rates and down payment assistance in Tennessee. Programs are available through approved lenders — not directly through the HFA.

THDA Great Choice Home Loan
Up to 6% of purchase price via Great Choice Plus at 0%

30-year fixed-rate mortgage with DPA for first-time buyers.

Income limit: $119,700 (varies by county)
Learn more at Tennessee Housing Development Agency (THDA)
THDA Great Choice Plus
Up to $6,000 — forgiven after 30 years

Deferred 0% second mortgage alongside the Great Choice first loan.

Income limit: $119,700
Learn more at Tennessee Housing Development Agency (THDA)
High Value — $240/funded loan

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Closing Costs in Tennessee

Typical Closing Cost Range
2.3% of purchase price

On a $335,000 home: approximately $7,705

Transfer Tax
0.37% ($3.70 per $1,000)

Tennessee charges a recordation tax of $0.37 per $100 of consideration (0.37%), paid by the buyer on the deed.

Attorney at Closing?
Yes — Tennessee is an attorney-closing state

Tennessee is an attorney-closing state. A licensed Tennessee real estate attorney must conduct the closing. Budget $600–$1,000 for attorney fees.

Key Tips for Buying in Tennessee

  • Tennessee has no state income tax on wages — a significant long-term financial benefit.
  • Nashville, Knoxville, and Chattanooga are all competitive; Chattanooga offers the best value for first-time buyers.
  • Termites are active year-round in Tennessee — always get a wood-destroying insect inspection.
  • Nashville's suburban growth has pushed prices up significantly — look at Murfreesboro, Franklin, and Clarksville for more affordable options.
Home Inspection

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Legal Help for Tennessee Buyers

As an attorney-closing state, Tennessee requires a licensed real estate attorney to conduct your closing. You'll also want one to review your purchase agreement.

Legal Help for FSBO Buyers

Nolo

Nolo has been the go-to legal resource for DIY buyers since 1971. Their real estate guides explain purchase agreements, contingencies, and closing in language anyone can understand.

Browse Legal Guides
LegalZoom

Get a real estate attorney to review your purchase agreement or help you draft an offer letter — often for a fraction of traditional legal fees.

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US Legal Forms

Download state-specific purchase agreements, addenda, and disclosure forms — written by attorneys, ready to use in your state.

Browse Real Estate Forms

Frequently Asked Questions

What first-time buyer programs are available in Tennessee?

Tennessee first-time buyers can access programs through the Tennessee Housing Development Agency (THDA) (https://thda.org/), including the THDA Great Choice Home Loan (Up to 6% of purchase price via Great Choice Plus at 0%) and the THDA Great Choice Plus (Up to $6,000 — forgiven after 30 years). Federal programs like FHA loans (3.5% down) and USDA loans (0% down in eligible areas) are also available.

What are typical closing costs in Tennessee?

Closing costs in Tennessee typically run 2.3% of the purchase price. Transfer tax: 0.37% ($3.70 per $1,000). Tennessee charges a recordation tax of $0.37 per $100 of consideration (0.37%), paid by the buyer on the deed.

Do I need an attorney to buy a home in Tennessee?

Tennessee is an attorney-closing state. A licensed Tennessee real estate attorney must conduct the closing. Budget $600–$1,000 for attorney fees.

What is the average home price in Tennessee?

The median home price in Tennessee is approximately $335,000. Property taxes average 0.64% of assessed value annually.

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