DSCR loans in Tennessee — what actually changes?

THE NUMBERS

ILLUSTRATIVE — published program floors, not a quote or a commitment to lend. Subject to underwriting, appraisal and final credit approval.

How much is the Tennessee tax on my loan?

The Department of Revenue sets the indebtedness (mortgage) tax at $0.115 per $100 of indebtedness, with the first $2,000 of the debt exempt. On a $300,000 loan that is roughly $343. The realty transfer half of the recordation tax is $0.37 per $100, generally based on the greater of the consideration paid or the value of the property, so a $400,000 purchase carries about $1,480 on the deed. Both are collected by the county register at recording. Your title company will quote the exact figures with recording fees on the settlement statement.

Does the mortgage tax hit a refinance too?

The indebtedness tax is imposed on recorded debt, so a new mortgage means the tax is calculated again on the new amount. That is one of the quiet arguments for doing a Tennessee cash-out once, at the right size, rather than in two passes twelve months apart. It also nudges portfolio investors toward a single blanket note over five separate mortgages, though the release terms matter more than the tax. Your title company or closing attorney is the authority on how the tax applies to your specific instrument.

How does non-judicial foreclosure affect me?

Tennessee is a deed-of-trust, non-judicial foreclosure state: a trustee can sell after statutory notice without a lawsuit. Lenders like the speed, which is part of why Tennessee stays broadly available in the DSCR market. It does not change Silt's pricing — the grid is national — but it does affect the deals you will see, because distressed inventory clears faster here than in a judicial state like Pennsylvania. It is also why title work and payoff accuracy matter: the machinery moves quickly in both directions.

What is the property tax and insurance picture?

Tennessee's effective property tax rates run low by national standards and there is no state tax on wage income, which is a meaningful part of the in-migration story behind Nashville and Chattanooga. Residential property is assessed at a statutory fraction of appraised value, so the headline millage rate is not the effective rate — take the actual bill from the assessor, not a rule of thumb. Insurance is ordinary: a landlord policy, with wind and hail deductibles worth reading in the storm-exposed western counties. The desk underwrites the real bill on both lines.

What should I check before betting on short-term rental income?

Nashville is one of the country's most actively regulated short-term rental markets: Metro runs a permit system that distinguishes owner-occupied from non-owner-occupied properties and restricts the latter by zoning district. Gatlinburg, Pigeon Forge and the Smokies corridor operate their own rules, and HOAs add minimum-stay covenants on top. Check the ordinance and the HOA before you underwrite a nightly number. Where the use is not clearly permitted, the desk prices the file on long-term market rent instead, which is usually the difference between a deal and a decline.

Which Tennessee markets do investors bring us?

Nashville's core prices like a growth market — thinner yields, strong rent growth, heavy STR regulation — while the ring counties, Rutherford and Wilson especially, carry a better long-term rent-to-price posture. Memphis remains the state's classic cash-flow market with well-worn out-of-state ownership and correspondingly careful management underwriting. Chattanooga and Knoxville sit in between, with Knoxville's university demand supporting steady occupancy. Clarksville draws Fort Campbell demand. Qualitative posture, not a forecast.

Worked example — a Memphis single-family rental

Illustrative only, from published program floors — not a quote, an approval, or a commitment to lend. The indebtedness tax is a cash-to-close item; it does not enter the DSCR calculation.

WHAT WE NEED FROM YOU

• Entity documents — articles or certificate of formation, operating agreement, EIN letter. Every Silt loan closes in an LLC or corporation, never a personal name.
• Leases or a rent roll — current leases where the units are occupied; on a vacant unit the appraiser's rent schedule (Form 1007) carries the income.
• Insurance — a binder naming the borrowing entity, with the lender's mortgagee clause.
• Bank statements — two months, showing reserves and the source of the down payment.
• Contract or payoff — the purchase contract if buying, the payoff statement if refinancing.
• Tennessee add-on — the county assessor's current bill, since assessed value is a statutory fraction of appraised value and rules of thumb misprice the tax line.
• Tennessee add-on — the short-term rental permit or the local ordinance section, if the file is underwritten on nightly revenue.

FREQUENT QUESTIONS

Does Silt lend in Tennessee?

Yes, on the same programs and the same grid as everywhere else in the 42-state footprint.

How much is Tennessee's mortgage tax?

$0.115 per $100 of indebtedness, with the first $2,000 of the debt exempt, collected by the county register when the mortgage is recorded.

Can Nashville Airbnb income qualify?

Only where the ordinance and HOA permit the use. Where they do, the desk uses twelve months of host revenue net of platform fees, divided by twelve, and prices short-term rental at +37.5 basis points.

Do I need to be a US citizen?

No. Silt lends to US citizens, permanent residents, non-permanent residents and foreign nationals; foreign-national files cap at 70% LTV and price 75 basis points higher.

Will you pull my credit to quote?

No. Quoting is free and takes no credit pull. Credit is pulled only when you want a written term sheet, and it sets the pricing tier.

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