Tennessee Mortgage Overview
Tennessee has always been an affordable
place to live despite its rising home prices. In 2020, the average home price
was $167,000. Almost 7 million people live in Tennessee because of its
affordability and beauty.
If you're thinking of moving to Tennessee,
here are your top loan options:
Tennessee conventional loans
Do you have great
credit? Get a conventional loan. You need just a 660 credit score and a 3 - 5
percent down payment. You'll pay PMI if you put down less than 20 percent on
the home, but the rates are so affordable that it's worth it, plus you can
cancel PMI once you owe less than 80 percent of the home's value.
Tennessee FHA loans
FHA loans are a
conventional loan alternative. You don't need perfect credit - you need just a
580. With a 3.5 percent down payment that you can get as a gift or down payment
assistance, you're on your way to owning your first home. FHA loans have great
rates but charge mortgage insurance for the loan's term.
Tennessee VA loans
Veterans have the advantage
of 100 percent financing. VA lenders get a guarantee from the VA that they'll
receive some of the money back that they lose if you default. This allows VA
lenders to offer flexible guidelines including no down payment. It's a great
way to get your first home.
Tennessee USDA loans
If you don't qualify for
the above loans, the USDA loan may be a good option. You must make less than
115 percent of the average income for your area to qualify, but if you do, you
don't need a down payment. All you need to qualify is a 640 credit score and a max
41 percent debt-to-income ratio.
First-Time Homebuyer
Programs in Tennessee
Great Choice Home Loans
If you're a
moderate-income household, enjoy the low rates and closing costs on the Great
Choice Home Loan. This 30-year term has a fixed rate. You need a 640 credit
score to qualify and must fall within the income guidelines.
Down payment assistance
If you apply for and
qualify for a Great Choice Home Loan, you can get down payment assistance too.
The Great Plus Second Loan is between $6,000 - $7,500 and is repaid over a 15-year
term.
These loans help you get your first home at
rates and costs lower than traditional loans. You still get the loan from a
local lender and may shop around to get the lowest rates and best terms for
your loan.
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