Tennessee variant. This is a Tennessee-specific version of the Refinance Calculator, using pre-defined local figures (tax rates, median home and income values, and typical regional costs). For the full formula, methodology, and FAQ, open the main Refinance Calculator.
Refinancing a Tennessee mortgage makes sense when the monthly interest savings recover your closing costs before you sell or move. On the state's $320,000 median home, even a small rate drop moves real money.
When refinancing pays off in Tennessee
Closing costs typically run 2-5% of the loan balance. On a $256,000 loan (80% of the $320,000 median home), that's roughly $7,680 at 3%.
Your break-even point is closing costs ÷ monthly savings. Drop your rate enough to save $200/month and you'd recover $7,680 in about 38 months - refinance only if you'll stay past that point.
About taxes and housing in Tennessee
Tennessee levies no state income tax on wages, having fully repealed its tax on interest and dividend income in 2021.
Tennessee's effective property tax rate is relatively low near 0.67%, with median home values around $320,000.
Tennessee's economy includes music and tourism in Nashville and Memphis, automotive manufacturing, and healthcare.
Worked example: break-even in Tennessee
Loan $256,000, closing costs ≈ $7,680 (3%). If a refinance cuts your payment by $250/month, break-even ≈ 31 months. Use the calculator above with your actual rates and balance.
Quick reference
- State income tax: No state income tax (eliminated Hall tax in 2021)
- State sales tax: 7% (plus 2.55% avg local)
- Median home value: $320,000
- Median household income: $67,631
- Effective property tax rate: 0.67%
- Avg auto insurance: $1,373/yr
Frequently Asked Questions
Is it worth refinancing in Tennessee?
It depends on your break-even: closing costs divided by monthly savings. If you'll keep the home past break-even, refinancing usually pays off.
What are typical closing costs in Tennessee?
Refinance closing costs generally run 2-5% of the loan, or roughly $7,680 on a median Tennessee loan.