Tennessee Charges Two Recordation Taxes, and Most Coverage Names One
Program and regulatory figures verified October 9, 2026. Details change; confirm your scenario with us.
Tennessee taxes the deed and the note separately. A buyer who budgets for one of them is short on closing day.
The two rates
| Tax | Rate | Applied to |
|---|---|---|
| ★ Realty transfer tax | $0.37 per $100 | the purchase price |
| ★★ Mortgage tax | $0.115 per $100 | the indebtedness, with the first $2,000 exempt |
Both are published by the Tennessee Department of Revenue, whose wording for the first is "$0.37 per $100 of purchase price for the realty transfer" and for the second "$0.115 per $100 of indebtedness. (The first $2,000 of the debt is exempt from taxation.)"
★★ Why the second one matters
Most Tennessee closing-cost summaries mention the transfer tax and stop. The mortgage tax is a separate line, it is charged on the amount you borrow, and for a financed purchase it is not small relative to the first.
★ It also behaves differently. The transfer tax is fixed by the price you agreed. The mortgage tax falls as the loan falls, so a larger down payment reduces it. That is the one place in a Tennessee closing where the financing decision moves a tax line.
★ For a physician putting little down on a portfolio loan, the mortgage tax is proportionally at its largest. Worth knowing in advance rather than at the table. How the loan works.
The arithmetic, which is all it is
Both are flat rates, so there is no estimating involved:
- Transfer tax: price ÷ 100 × $0.37. That is 0.37% of every $100, or $370 per $100,000 of price.
- Mortgage tax: (loan amount − $2,000) ÷ 100 × $0.115, or about $115 per $100,000 borrowed.
- On Nashville's typical value of $452,186, the transfer tax runs about $1,673.
★ Those are the tax lines only. They are not the whole closing cost, and we are not quoting you a payment: this site publishes no rate or payment figure anywhere.
★★ A correction we are making in public
An earlier version of this page said Tennessee published no transfer-tax rate.
That was wrong, and the reason it was wrong is worth stating. We had gone looking at two Department of Revenue addresses that returned 404, concluded the pages had gone in a site migration, and published the omission rather than a guess. The rule we work to is cite or omit, and we omitted.
★★ But a 404 on a URL we assembled ourselves is evidence about our URL, not about whether the state publishes the fact. The live page sits under revenue/taxes/local-taxes/recordation-taxes and has both rates on it. We found it, verified it reads to the AI crawlers as well as to a browser, and replaced the omission with the figures.
★ Leaving that visible is the point. A site that tells you what it got wrong is easier to trust on the things it got right.
★ What we are still not telling you
- Who pays. Allocation between buyer and seller is a matter for the contract and local custom, and we are the lender, not your agent or attorney. Ask them.
- Local additions. We publish the state rates we verified. If a specific county or city adds anything, your title company will have it.
- Exemptions. Beyond the $2,000 mortgage-tax exemption the Department states, we are not interpreting exemption law for you.
Ask your closing agent for a preliminary figure while you are under contract rather than after.
The other Tennessee numbers that move a file
The county conforming limit, which genuinely varies here, and the student loan payment. Both are on this site with sources.
The 14 high-cost counties · Student loan treatment.
Mike Certo, NMLS #260555. (480) 296-6513 · mcerto@cfmtg.com.
Frequently asked questions
What is the transfer tax in Tennessee?
The Tennessee Department of Revenue sets the realty transfer tax at $0.37 per $100 of purchase price. That works out to about $370 per $100,000 of price, and on a $452,186 purchase it is roughly $1,673.Does Tennessee charge a mortgage tax?
Yes, and it is separate from the transfer tax. The Department of Revenue sets it at $0.115 per $100 of indebtedness, with the first $2,000 of the debt exempt from taxation. It is charged on the amount borrowed rather than the purchase price, so a larger down payment reduces it.How much is Tennessee transfer tax on a $100,000 purchase?
About $370, at the published rate of $0.37 per $100 of purchase price. The mortgage tax is charged separately at $0.115 per $100 of indebtedness, which is roughly $115 per $100,000 borrowed after the first $2,000 of debt, which is exempt.Who pays the transfer tax in Tennessee?
Allocation between buyer and seller is a matter for the purchase contract and local practice, which is a question for your agent and attorney rather than your lender. Your closing agent computes the charge and it appears on the settlement statement.Mike Certo · NMLS #260555 · Cornerstone First Mortgage NMLS #173855 · Equal Housing Lender. Educational content about physician mortgage financing, not a loan commitment and not legal, tax or financial advice. The Tennessee State Loan Repayment Program is administered by the Tennessee Department of Health and the Family Medicine Loan Repayment Incentive through the Tennessee Academy of Family Physicians, neither by Cornerstone; their terms, award amounts and application cycles are set by those bodies and change. Figures here carry the date we verified them against the programmes' own published materials. Physician-loan program terms, eligible degrees and overlays are set by the lender and change. All loans are subject to borrower, property and program qualification.