Tennessee
VA One-Time Close Construction Loans in Tennessee
From Clarksville near Fort Campbell to Memphis, Nashville and Knoxville, Tennessee VA builds succeed or fail on local comps. Here is the honest breakdown.
Home Loans Inc is not licensed in Tennessee and cannot take a Tennessee loan application. We originate in South Carolina | North Carolina | Virginia | West Virginia | Florida | Georgia | Alabama | Mississippi | Iowa | Wyoming.
Our recommendation for Tennessee: Ricky Young at NoSo Funding
There are maybe a handful of people in the country who really understand the VA One-Time Close construction loan. Ricky is one of them. His site nosofunding.com is one of the best VA OTC resources out there - not because it is flashy, but because it is honest and thorough in the same way we try to be.
We are sending you to Ricky because we trust him, not because we get anything out of it. He will tell you the truth about whether your deal works, and he will not waste your time if it does not. That is the same standard we hold ourselves to in the states where we are licensed.
NoSo Funding - Ricky Young
VA One-Time Close construction loan specialist serving Tennessee.
If Ricky tells you the numbers do not work, believe him. If he tells you they do, you are in good hands.
Do the recordation tax math first
Most state pages start with bases. Tennessee gets a math problem first, because it is one of the few places where the deed of trust itself carries a state charge. Tennessee levies a recordation (indebtedness) tax of $1.15 per $1,000 of principal above $2,000. The rough formula is the loan amount minus $2,000, times 0.00115, on top of normal recording fees. Ask your lender how they apply it to a construction loan and where it shows up in your closing figures, since every dollar at closing is part of the picture.
A few other Tennessee closing habits are good to know in advance. Title or escrow companies handle closings, and since July 1, 2025 the borrower may choose the settlement agent. Closings fund wet. On a marital residence, Tennessee generally has the non-owner spouse sign the deed of trust to release marital and homestead rights, so confirm vesting with your title underwriter. Foreclosure is non-judicial, and remote online notarization is generally available.
Three installations that drive VA demand
Fort Campbell
Clarksville, TN and Hopkinsville, KY
Home of the 101st Airborne Division (Air Assault). Most of its people live on the Tennessee side around Clarksville, making it the largest driver of VA loan activity in the state.
Naval Support Activity Mid-South
Millington, near Memphis
Houses Navy Personnel Command and multiple tenant commands, in a metro with affordable land and moderate build costs.
Arnold Air Force Base
Tullahoma
Home of the Arnold Engineering Development Complex, surrounded by rural Coffee and Franklin County ground.
Region by region, where Tennessee comps hold up
Clarksville and the Fort Campbell corridor
A strong VA market with solid new-construction activity. Comps in the $350,000 to $550,000 range are generally available, and Montgomery County is one of the better spots in the state for an OTC deal to actually close. Above $600,000 it gets harder.
Nashville metro
Fast growth and new-construction comps at a wide range of prices, especially in Williamson, Rutherford, Wilson and Sumner counties. Here the comps are usually answerable. Busy, expensive contractors are the bigger issue.
Memphis metro
Affordable land and lower build costs, but support is neighborhood by neighborhood. Bartlett, Collierville and Germantown in suburban Shelby County have comps. Rural Fayette County does not, at least at new-construction prices.
Knoxville and East Tennessee
Knox and Blount counties have reasonable comps at moderate prices. The Smoky Mountain foothills thin out fast, and Sevier County is a tourist market with its own comp challenges.
Chattanooga
A smaller metro where Hamilton County has moderate comps. Signal Mountain and Lookout Mountain are unique markets, and nearby counties thin quickly.
Rural Tennessee and the Tullahoma area
Land is cheap, but cheap land plus expensive construction can produce a number the local market will not support. Around Arnold AFB, builds in the $300,000 to $400,000 range may find support. Above that, the appraiser's job gets very difficult.
Same VA loan, Tennessee address
The One-Time Close structure is identical here: one loan and one closing for the land, the build and the permanent mortgage, with zero down for an eligible veteran who has full entitlement. A VA-registered builder with a VA builder ID is required. VA's appraiser values the home from plans and specs and VA Form 26-1852, and the result is a Notice of Value. The builder is paid in draws after inspections. Your completed home must appraise for the Total Acquisition Cost, the sum of lot, construction, contingency, accrued interest and funding fee. That fee is 2.15% on first use and 3.3% after, at zero down, and it is waived if you receive VA disability compensation. Lenders often want a score near 660. Run your own estimate with the cost estimator and keep the FAQ handy.
Home Loans Inc is not licensed in Tennessee and cannot take your application. Use this as preparation for a conversation with a Tennessee-licensed lender who knows your county.
Tennessee VA OTC questions
How does Tennessee's recordation tax apply to a VA construction loan amount?
Tennessee charges a recordation, or indebtedness, tax of $1.15 per $1,000 of principal above $2,000. The rough formula is the loan amount minus $2,000, times 0.00115, on top of recording fees. Ask your lender to show exactly how it is calculated on your loan and where it appears in your closing figures.
Is Clarksville a good place for a VA One-Time Close near Fort Campbell?
It is one of the better spots in Tennessee. The Fort Campbell corridor has solid new-construction activity, and comps in the $350,000 to $550,000 range are generally available, with Montgomery County a strong area. Above $600,000 the comps get harder to find, so size the build accordingly.
Can I choose my own title company for a Tennessee closing?
Yes. Tennessee closings are handled by a title or escrow company, and since July 1, 2025 the borrower may choose the settlement agent. Closings fund wet, and remote online notarization is generally available. Coordinate your choice with your lender so the construction loan documents and draw setup line up.
Does a non-owner spouse sign in Tennessee?
On a marital residence, Tennessee generally has the non-owner spouse sign the deed of trust to release marital and homestead rights. Expect your spouse to be at the table even if they are not on the loan, and have your title underwriter confirm vesting early.
Will Home Loans Inc originate my VA construction loan in Tennessee?
No. Home Loans Inc is not licensed in Tennessee and cannot accept an application for property there. Use this site to understand the loan and the appraisal risk, then talk with a Tennessee-licensed lender who has closed One-Time Close loans in your county.