The reverse mortgage Tennessee homeowners get lets them borrow against their home with no monthly payments, using loan papers carrying a state label. In Tennessee, 666 of these loans got federal insurance between October 2025 and August 2026. The median home value among borrowers was $340,500 and the median initial principal limit was $151,555. The total pool of money your loan makes available before fees and payoffs is your initial principal limit. Before you look into local rules, you can learn how a reverse mortgage works.
Can the Tennessee Property Tax Relief along with the Tax Freeze programs help you?
You must keep up your property taxes and homeowners insurance, as required by federal reverse mortgage rules that apply in every state. You're also required to live in the home as your primary residence and maintain it in good repair. Getting behind on property taxes can trigger a default on a HECM, which is why state tax programs are important.
Property Tax Relief: reimbursement from the state
Property taxes are refunded to elderly or disabled low-income homeowners and to disabled veterans or their surviving spouses through the Tennessee Property Tax Relief program. What you get is a state reimbursement, not an exemption, so your tax bills still arrive and you still have to pay them. You can get an application from your county trustee or the city official who collects taxes.
Locking in your bill once you turn 65 with the Property Tax Freeze
If your county or city takes part, the local-option Tennessee Property Tax Freeze locks in the taxes on your primary home. Once you qualify, your tax gets fixed at that year's amount, so rate increases or reappraisals won't change it. By the close of the year in which you apply, your age must be at least 65. Each year the Comptroller figures the income limit for every county; for 2026 the range runs from $38,470 to $69,150. You'll need to reapply every year to hold onto the freeze.
The 2026 Tennessee Reverse Mortgage Innovation Act
The Governor's signature on May 19, 2026 brought the Tennessee Reverse Mortgage Innovation Act into effect. State law now governs reverse mortgages, including proprietary ones, and the Home Equity Conversion Mortgage Act gets a new name through this change. When a lender offers you a private loan that the federal government doesn't insure, that's a proprietary reverse mortgage. Some owners turn to private loans when a home is worth more than the federal HECM cap of $1,249,125; 17 Tennessee loans hit that limit.
The act says the mortgage or deed of trust and the note each must show a standard label. The legal paper you sign to put your home up as security for the loan is a deed of trust. The label says the loan is a reverse mortgage as defined by Tennessee Code Annotated, Title 47, Chapter 30.
Lender oversight at the Tennessee Department of Financial Institutions
Tennessee law spells out how reverse mortgage lenders get authorized in the state. To become authorized lenders, the Tennessee Housing Development Agency, credit unions, savings institutions and banks can provide advance notice. The commissioner of financial institutions needs at least 30 days' notice from them before any loan is made. All other lenders must submit a written application to the commissioner. In Tennessee, 68 active lenders made federal reverse mortgages available, and the state is home to 2 HUD-approved agencies offering counseling.
If you have a complaint about a regulated lender, send it to the Tennessee Department of Financial Institutions Consumer Resources Section. Put your complaint in writing. When the department doesn't oversee your lender, it passes your complaint on to the correct regulator.
