Tennessee DSCR Lenders 2026: 3,696 Loans, 133 Lenders Ranked

From 16,493 investor loans to 3,696 DSCR-type loans

The federal file does not label DSCR loans, so the first job is to say what we counted. Every step below is a filter on the raw 2025 Tennessee file, and each count is in the data file.

How Tennessee's 2025 investor loans narrow to the DSCR-type group (federal HMDA data, our arithmetic)

Median note rates differ by group, and the DSCR-type rate is not the highest in the file or the lowest.

Median note rate by loan group, Tennessee investor loans, 2025 (our arithmetic)

So the DSCR-type premium over a borrower who qualified on personal income is about a quarter of a point (7.25% against 6.99% and 7.0%), and Tennessee's DSCR-type median is 0.125 points under the nation's 7.375% on the same definition (our national DSCR lender ranking). Tennessee is a mid-sized slice of that market: 3,696 of 154,354 loans, with 133 of the nation's 466 DSCR-type lenders active here.

Ranking Tennessee lenders two ways

Which lender is the biggest in Tennessee depends on what you count. Ranked by every conventional investor loan, the top of the list is a mix of platforms, wholesale mortgage companies, national retail lenders and Tennessee banks. Ranked by the DSCR-type subset, the banks and the retail lenders largely disappear.

Top 15 Tennessee lenders by all conventional investor loans, 2025, with how many were DSCR-type

Three things stand out. Kiavi's overall median of 9.95% is high because 521 of its 735 loans are short-term loans; its 214 DSCR-type loans priced at 7.375%. Rocket Mortgage is fifth with 293 loans and not one is business-purpose, so it is a lender to consumers who buy rentals, not to DSCR borrowers. And three banks in the top 12 (Pinnacle Bank, Wilson Bank and Trust, One Bank of Tennessee) reported no DSCR-type loans at all.

Top 20 Tennessee lenders by DSCR-type loans, 2025

What the second list says:

• It is concentrated, but not at the top. The five largest made 27.9% of the 3,696 loans, the top 10 45.2% and the top 20 67.6%. Fifty-nine lenders made 10 or more; 27 made exactly one; the 74 lenders with fewer than 10 loans made 6.5% together.
• Wholesale versus direct is a clean split. United Wholesale Mortgage, Champions Funding, Deephaven, OCMBC and Emporium TPO took 100% of their Tennessee loans through brokers; CrossCountry, RCN Capital, Hometown Equity, Lima One, American Heritage, Guaranteed Rate and Investor Mortgage Finance took none. Overall 1,970 loans (53.3%) came through brokers and the median rate was 7.25% both through brokers and direct.
• Loan size separates the lenders. Hometown Equity's median loan is $300,000, NewRez and Change Lending $265,000, Lima One $115,000, BPL $135,000. A $115,000 Memphis loan and a $485,000 Sevier loan are different products with the same label.
• Emporium TPO shows up only because we fixed a unit problem. The lender reports its 30- and 40-year loans with a term of 30 and 40 (years entered in a field that counts months). We counted its 71 Tennessee loans as 360- and 480-month loans; a plain 360-month filter would have dropped them.

The platform lenders borrowers ask about

Kiavi Funding reported 214 DSCR-type loans (median $155,000, 7.375%) plus 521 short-term ones. Investor Mortgage Finance, the Visio Lending affiliate, reported 78 DSCR-type loans at 7.1875% and a $250,000 median. Lima One Capital reported 95 at 7.75% and a $115,000 median (32 short-term loans). LendingOne reported 70 at 7.09%, RCN Capital 131 at 7.4667%, BPL Mortgage 209 at 7.25% and Velocity Commercial Capital 59 at 9.865%. These are only the loans HMDA shows, under the names the lenders filed; see our Kiavi review for the lender itself.

Rates by lender: 6.875% to 9.865%

For the 22 lenders with at least 50 DSCR-type loans, the median note rate ranges nearly three points. This is a median of closed loans, not a quote; a lender whose median is low may have written its loans at lower leverage or for stronger borrowers, which the file does not show.

Median DSCR-type note rate for Tennessee lenders with 50 or more loans, 2025 (lowest to highest)

Twenty-one of the 22 are inside a 1.0-point band, 6.875% to 7.875%. Velocity Commercial Capital stands alone at 9.865% (58 of its 59 loans are above 9%); of the 93 DSCR-type loans above 9%, Velocity made 58, CV3 Financial 8, Deephaven 7 and United Wholesale Mortgage 7. The payment gap is real money on the typical loan:

Monthly principal and interest on $195,000, 30-year fixed, at Tennessee DSCR-type rates (our arithmetic)

Going from 6.875% to 7.5% costs $82.46 a month, $989.52 a year, on $195,000; from the median to Velocity's median, $361.60 a month. By size, the median rate was 7.75% under $100,000, 7.25% from $150,000 to $299,999 and 7.125% from $300,000 to $499,999, so a small Memphis loan pays more per dollar. By loan-to-value the median ran 7.25% at 60% or less and 7.375% from over 75% to 80% (the median LTV was 75%). Purchases (1,513 loans) had a 7.25% median, cash-out refinances (1,280) 7.375%.

Banks lead the investor list and are almost absent from the DSCR list

Tennessee has 192 banks and credit unions (names containing Bank, Credit Union, Federal or N.A.) with at least one investor loan in the file. They made 3,457 loans, 26.8% of the state's 12,893, at a 7.09% median, and 84.1% were for a business purpose. But only 19 of them made a DSCR-type loan, 72 loans in all, because 64.5% of their investor loans have a term under 360 months.

Five Tennessee banks with the most investor loans, 2025

FirstBank, One Bank of Tennessee and The Farmers Bank wrote mostly 60-month loans (the term field is the contract term, so a 60-month term can still amortize over 25 or 30 years with a balloon, which HMDA flags separately and we did not rely on). Wilson Bank and Trust's median is 300 months. Pinnacle Bank is the exception, with a 360-month median, but it reported a debt-to-income ratio on 82.1% of its loans, and the 50 that did not were shorter-term loans, so none meets our definition. HMDA cannot tell you whether a bank's investor loan is underwritten on rent; it tells you the ratio field was filled in or not. For a borrower the practical point is that a local bank is a real alternative, especially for a lower rate (7.09% median), but a shorter term means a refinance or renewal inside five years.

Where in Tennessee: Memphis is the DSCR market, Sevier the cabin market

Three counties made 1,961 of the 3,696 loans (53.1%), and 238 more (6.4%) reported no county at all; those came mostly from RCN Capital (131) and Investor Mortgage Finance (78), whose loans carry the “99999” metro code. Seventy-seven counties had at least one DSCR-type loan and 30 had 10 or more.

Top 10 Tennessee counties by DSCR-type loans, 2025

• Shelby County is the DSCR county. 46.8% of its investor loans are DSCR-type, the highest of the large counties, on a $165,000 median property value and a $125,000 median loan. The leading lenders there are BPL Mortgage (121), Kiavi Funding (112), Loan Funder (88), Lima One (81) and CV3 Financial (63). Its 7.375% median is the highest of the ten counties in the table.
• Sevier County is a different animal. 350 loans, a $485,000 median loan on a $665,000 median property and a 7.125% rate; 97.7% were on one-unit properties. The leaders are United Wholesale Mortgage (58), Hometown Equity (39), NewRez (26), CrossCountry (25) and Champions Funding (17). The county is the gateway to the Smokies, and whether a given lender counts nightly rent is a lender rule that HMDA does not record.
• Davidson and Knox are mixed markets. DSCR-type loans were about a quarter of investor loans (25.9% and 25.7%), at a 7.25% median. In Rutherford County (19.1%) and Sumner County (15.0%) they were a smaller share.
• By metro area: Memphis 1,168 loans (46.4% of its investor loans), Nashville-Davidson-Murfreesboro-Franklin 808 (21.8%), Knoxville 353, Chattanooga 243 and Clarksville 123.

What the Tennessee rules add for a DSCR borrower

HMDA tells you who lends and at what rate. Five Tennessee rules we could read in primary sources change what a given rental costs or whether the loan is available. Each is a reading of public text, not legal advice.

A duplex is taxed as commercial property

Tennessee assesses residential property at 25% of value and commercial and industrial property at 40% (Tennessee Department of Revenue property tax page). The Attorney General's Opinion 25-016 (August 25, 2025) quotes the state constitution, Article II, Section 28, as defining residential property containing two or more rental units as industrial and commercial property, and says Tenn. Code Ann. 67-5-501(11) provides the same. It applies that to rentals: a stand-alone single-family property rented long term “generally will be classified as residential”, a duplex with one half owner-occupied generally will be too, and property with two or more rental units is commercial under the statute. The opinion adds that “there is no bright-line rule”: it cites a 2003 Court of Appeals decision classifying 44 single-family homes in one development, owned and managed by one entity, as commercial.

For DSCR borrowers this bites on 437 of the 3,696 loans (11.8%): 322 on two units, 46 on three and 69 on four. On the same value and the same local tax rate, the 40% ratio is 1.6 times the 25% ratio (our arithmetic). On the $275,000 median property value of the DSCR-type loans, assessed value is $68,750 at 25% and $110,000 at 40%; at each $1.00 of tax per $100 of assessed value, that is $687.50 against $1,100.00 a year. We did not use a county's actual tax rate, which is set locally. A lender that adds taxes to the payment in its DSCR test will count the larger bill, so check with the county assessor which class a 2-4 unit property is in before you price rent.

Closing costs the lender does not quote as interest

The Department of Revenue's Recordation Tax Manual (March 2023) states the indebtedness tax on recorded mortgages as 11.5 cents on each $100 of the debt, excluding the first $2,000, and the realty transfer tax as $0.37 per $100. On the $195,000 median loan the indebtedness tax is $221.95; on Sevier County's $485,000 median it is $555.45 (our arithmetic: the loan less $2,000, times 0.115 per $100). The manual is from 2023 and we did not open a later one.

Does a DSCR lender need a Tennessee license?

The Department of Financial Institutions says Tenn. Code Ann. 45-13-201(a) provides that “no person shall act as a mortgage lender, mortgage loan broker or mortgage loan servicer in this state without first obtaining a license” under the Tennessee Residential Lending, Brokerage and Servicing Act. The Attorney General's Opinion 10-93 (2010) quotes the Act's definition of a residential mortgage loan as a loan “primarily for personal, family or household use” secured by a mortgage or deed of trust on a dwelling, or on residential real estate on which a dwelling is or will be built (Tenn. Code Ann. 45-13-105(25)). That wording turns on purpose, which is why the question is live for business-purpose rental loans. Whether a specific loan to an LLC falls inside the Act is not verified here: the opinion is from 2010, we did not open the current text, and TDFI's page lists no business-purpose exemption. You can check any lender free in NMLS Consumer Access and ask which basis it relies on.

A rate ceiling you can compare to

TDFI announced on October 27, 2026 that the maximum effective formula rate of interest in Tennessee is 11.00 percent per annum, set at 4 points over a 7.00 percent prime rate, and that the November 2026 home-loan rate under Public Chapter 290 of 2025 (Tenn. Code Ann. 47-15-102) is 11.37 percent, 4 points over an average prime offer rate of 7.37 percent, never above 18%. The highest DSCR-type note rate in the 2025 file is 10.99%; 22 loans are above 10% and none above 11%. That is a comparison only: ceilings change weekly or monthly, we did not pull the 2025 values, and whether either ceiling applies to a business-purpose rental loan is not verified.

Short-term rental rules: Nashville and the state act

Tennessee's Short-Term Rental Unit Act (Public Chapter 972 of 2018, Tenn. Code Ann. 13-7-603) says a local rule on short-term rentals does not apply to a property that was already used as one before the rule, until the property is sold or transferred, goes 30 continuous months unused, or has three violations. For a buyer, that protection ends at sale. In Nashville, Metro Codes states that “New not owner-occupied permits are not permitted in AR2A, R, RS, or RM zoned properties” and that existing permits there are not transferable on a sale; new non-owner-occupied permits go only to listed commercial, mixed-use and office districts (page last updated March 13, 2026). Owner-occupied permits require a natural person, so an LLC is ineligible. Sevier County, Gatlinburg and Pigeon Forge rules are not verified: the county and city pages were not readable from our network.

One more entity point: Public Chapter 950 of 2024 eliminated the property measure of the Tennessee franchise tax for tax years ending on or after January 1, 2024 (Department of Revenue legislative summary). Whether your LLC owes franchise and excise tax depends on its structure, which a CPA should confirm. See our DSCR with an LLC page for the entity side.

How we read the federal file

The Home Mortgage Disclosure Act file lists each loan a reporting lender originates, with its note rate, amount, loan-to-value, purpose, county, lender and term. We downloaded the 2025 Tennessee file from the FFIEC HMDA Data Browser on October 28, 2026 (176,247 originated loans, all occupancy types), kept occupancy type 3 locally because the browser's occupancy filter does not narrow the download, and computed everything on this page from the raw file with a saved script (our arithmetic). We keep a loan if it is a conventional first lien, closed-end, not a reverse mortgage, on a one-to-four-unit investment property. The DSCR-type subset is the business-purpose loans with a debt-to-income ratio of NA and a term of 360 months or more. Our Colorado, Maryland and Texas pages use the same proxy, and our Tennessee hard money page reads the short-term slice of the same file (1,741 loans). Lender names are as filed with the FFIEC; one brand can be several legal entities.

Limits, so you can weigh the numbers:

• HMDA does not mark DSCR loans. Other no-ratio business loans fall into the group, and so do loans to individuals; 1,254 of the 3,696 (33.9%) were to applicants reported as not natural persons. Lenders below the reporting thresholds are not in the file.
• Rates, not prices. Discount points are reported on 3 of the 3,696 loans and the prepayment-penalty term on none (it is NA on every loan), and the file has no credit score, rent or DSCR ratio.
• Only originated loans. The file we used has no denied or withdrawn applications, so we cannot rank lenders by denial rate as our national page does.
• Names and gaps. One filer (LEI 894500QC0C65HO7V5165, 23 investor loans, none DSCR-type) is not in the FFIEC 2025 filer list we used and appears under its LEI; 12 business-purpose no-ratio loans have no term and are excluded. Banks are identified by name only.
• Small counts. County medians for Sullivan, Sumner and Wilson counties rest on 50 to 56 loans; read them as direction.
• Rounded amounts. HMDA loan amounts are rounded to band midpoints, so medians land on multiples of $5,000.

What a Tennessee investor can do with this

1. Compare at least one bank with a DSCR lender. The bank median for investor loans was 7.09% against 7.25% for DSCR-type, but with a 60-month median term at several large banks. Ask for amortization, balloon date and renewal terms in writing. Our DSCR versus conventional comparison shows which one a property clears.
2. Shop inside the 6.875% to 7.875% band. Twenty-one of the 22 large DSCR-type lenders have medians in it. Only 421 of the 3,696 loans (11.4%) were above 8%, and one lender (Velocity) accounted for 58 of the 93 loans above 9%, so a quote far above 8% is worth a second one.
3. Classify the property before you price the rent. A 2-4 unit rental is commercial property at 40% under Tenn. Code Ann. 67-5-501(11); an assessor, not the lender, decides the class.
4. Do not assume a short-term rental license. A Nashville purchase cannot take over a non-transferable non-owner-occupied permit, and new ones are not available in residential zones. Until you hold the permit, the safe figure is long-term rent (see our short-term rental DSCR page).
5. Ask who funds the loan and under what Tennessee basis. 53.3% of DSCR-type loans came through brokers. Search the lender in NMLS Consumer Access and ask which Tennessee license or exemption it relies on.
6. Budget the recording tax. About $222 on a $195,000 loan, per the Department of Revenue's manual, plus lender fees that HMDA cannot show.

What we could not verify

• Whether Tennessee's licensing Act, the formula rate or the home-loan rate ceiling applies to a particular business-purpose loan on an investment property: not verified (statute text not opened; TDFI and the Attorney General opinion read only).
• The Uniform Residential Landlord and Tenant Act's county coverage and late-fee and deposit rules: not verified (the code text was not readable from official sites on October 28, 2026).
• Sevier County, Gatlinburg, Pigeon Forge and Memphis short-term-rental rules, and 2025-2026 reappraisal tax rates for Shelby and Davidson counties: not verified.
• Whether any state or federal limit on large institutional buyers of single-family homes would affect a borrower: only secondary reports were found, so not verified.
• The 2026 version of the Department of Revenue's Recordation Tax Manual: not opened.

FAQ

Related reads: Colorado, Maryland and Texas DSCR pages use the same federal data, and DSCR lenders ranked by loans reads the national file.

Loan-level data: FFIEC/CFPB HMDA Data Browser, originated loans for Tennessee, 2025, downloaded October 28, 2026 (the request URL is in the data file; the script and its output are saved with our working files); lender names from the FFIEC 2025 filer list and GLEIF; county names from the Census Bureau 2020 county list and metro names from the OMB 2023 CBSA delineation; Tennessee sources: Tennessee Department of Financial Institutions (mortgage company, formula-rate and home-loan-rate pages, read October 28, 2026), Tennessee Attorney General Opinions 10-93 and 25-016, Public Chapters 290 (2025), 950 (2024, via the Department of Revenue summary) and 972 (2018), the Department of Revenue property tax page and Recordation Tax Manual (March 2023), and Metro Nashville Codes and Building Safety (short-term-rental permit types). All counts, percentiles, medians, shares and payment figures are our arithmetic. This is analysis of public documents, not investment, legal or tax advice, and not a loan offer.