Tennessee HELOC Rates and Rules 2026: The Mortgage Tax

HELOC rates in Tennessee right now

Most HELOCs have a variable rate based on the prime rate plus a margin set by the lender. Your margin depends mostly on your credit and how much of your home's value you borrow.

In 2025, the median HELOC in Tennessee opened at 7.50%, and half opened between 6.24% and 8.56%, across 19,317 lines reported under federal HMDA data. The national median was 7.50%. Leaving out lines with a 3 to 12 month introductory rate, the Tennessee median was 7.75%. Home equity loans in Tennessee, which usually have a fixed rate, closed at a median of 8.75%. HELOC rates in every state.

Prime rate, unchanged since September 17, 2026 (Federal Reserve): 7.00%
Median Tennessee HELOC rate at opening, 2025 (HMDA): 7.50%
Average 30-year fixed mortgage rate, week of October 29, 2026 (Freddie Mac): 7.24%

The Federal Reserve raised rates on September 16, 2026, which moved prime to 7.00%. Its October 27 and 28 meeting is more recent than the prime rate data shown here, which runs through October 27, 2026. Its next meeting is December 8 and 9. With 30-year mortgage rates above 7%, a HELOC lets you borrow against your equity without refinancing a lower rate you already have.

How much can you borrow in Tennessee?

Tennessee law doesn't cap home equity borrowing the way Texas does. Each lender sets its own limit on all the loans on your home combined, your current mortgage plus the new line.

Your Tennessee deed of trust has to state the maximum amount of the line, and that maximum is what the state taxes when it is recorded (see the rules below).

Home value ×80% −what you owe now =a likely maximum line

Example

Home value (the Tennessee median for owner-occupied homes): $332,600
80% of value (a common lender limit, not a Tennessee law): $266,080
Current mortgage balance: $180,000
Maximum line of credit: $86,080

Example only. Lenders set their own limits and the final amount after an appraisal, and many approve less than the maximum based on credit and income.

Run your own numbers in our home equity calculator

Tennessee home prices more than doubled from 2014 to 2025

On the FHFA House Price Index, Tennessee home prices rose 141% from 2014 to 2025, with the biggest jumps in 2021 (+20.0%) and 2022 (+18.2%). Growth has slowed since: prices rose 2.0% in 2025 and 0.88% in the year to mid-2026, 42nd of the 50 states and DC. Owners who bought before 2021 have seen the biggest gains.

Source: FHFA House Price Index, Tennessee, purchase-only, through 2026 Q2.

Chart data as a table

Tennessee House Price Index, annual average (1991 = 100)
Year	Index (1991 = 100)
2014	197.17
2015	208.22
2016	221.70
2017	238.00
2018	255.10
2019	272.63
2020	298.12
2021	357.85
2022	422.82
2023	443.27
2024	465.96
2025	475.18

The Tennessee rules that affect a HELOC, in plain English

Tennessee has no special HELOC limits like a borrowing cap or a waiting period. These Tennessee taxes and laws still shape your HELOC. They come from the Department of Revenue, the Comptroller and Tennessee law, summarized here in plain words.

The recording tax

11.5 cents per $100.: Tennessee taxes the debt secured by your home when the deed of trust is recorded, at $0.115 per $100. The first $2,000 is exempt. The Department of Revenue says the borrower pays it.
Charged once, on the full limit.: For a line of credit the tax is based on the maximum amount stated in the deed of trust. Drawing and paying down within that limit doesn't add any tax.
About $113 per $100,000.: On a $100,000 line the tax is $112.70.
Raising the limit later.: If you increase the line later, tax is due on the full increase, with no $2,000 exemption.

Before you sign

Use a licensed lender.: Lenders that are not banks need a Tennessee mortgage license from the Department of Financial Institutions under the state's Residential Lending, Brokerage and Servicing Act.

If you can't pay

Foreclosure without a court case.: A Tennessee lender can foreclose by selling the home at a public sale after advertising it, without a court case. Since July 1, 2025 the sale has to be advertised at least twice in a local newspaper and for at least 20 days on a public notice website.
Deficiency judgments.: If the sale doesn't cover the debt, the lender can sue for the rest, measured against the home's fair market value. The sale price is presumed to be fair market value unless you prove it was materially less.
Homestead exemption.: Tennessee's homestead exemption protects up to $35,000 of equity from creditors' judgments ($52,500 for certain joint owners). It is not a property tax break.

Property tax basics

Taxed on 25% of value.: Homes are assessed at 25% of appraised value, then taxed at the local rate per $100. A $400,000 home at a $2.50 rate pays $2,500 a year.
Tax relief is a refund.: Low-income seniors, disabled homeowners and disabled veterans can get part of their property tax paid back by the state. It is a reimbursement, not an exemption.
Tax freeze at 65.: Where a county or city has adopted it, owners 65 or older who meet an income limit can freeze the tax on their home. In 2026, 28 counties and 37 cities take part.

Tennessee homeowners by the numbers

Median value of an owner-occupied Tennessee home: $332,600; U.S.: $360,600
Tennessee homeowners with no mortgage at all: 43.5%; U.S.: 40.3%
Owner-occupied homes in Tennessee: 2.0 million
Median yearly property tax paid in Tennessee: $1,488; U.S.: $3,211

Source: U.S. Census Bureau, American Community Survey 2024 1-year estimates.

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Frequently asked questions

Is there a mortgage tax on a HELOC in Tennessee?

Yes. Tennessee charges 11.5 cents per $100 of the debt when the deed of trust is recorded, and the first $2,000 is exempt. The Department of Revenue says the borrower pays it.

Is the Tennessee tax based on my credit limit or on what I draw?

On the maximum amount stated in the deed of trust. Drawing and repaying within that limit doesn't add any tax.

How much is the Tennessee recording tax on a $100,000 HELOC?

$112.70. That is $0.115 per $100 on the $98,000 left after the $2,000 exemption.

What happens if I increase my HELOC limit later?

Tax is due on the full amount of the increase. The $2,000 exemption only applies to the original filing.

Is foreclosure in Tennessee judicial or non-judicial?

Non-judicial. The home can be sold at a public sale after it is advertised, without a court case, and since July 1, 2025 the sale must be advertised at least twice in a local newspaper and for at least 20 days online.

How are Tennessee property taxes calculated?

Homes are assessed at 25% of appraised value, then taxed at the local rate per $100 of assessed value. A $400,000 home at a $2.50 rate pays $2,500 a year.

Does checking my options with LenderMatch affect my credit?

No. LenderMatch never pulls your credit. A lender you choose to work with may check it, with your permission.

HELOCs in Tennessee: how much you can borrow and the rules that apply

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