FHA Loans in Nashville, Tennessee

Where FHA fits in Nashville

Nashville's rapid appreciation has pushed median prices in many Davidson County neighborhoods above the range where FHA is the most cost-effective choice. In higher-priced areas — Green Hills, 12 South, East Nashville, Germantown — buyers with strong credit and a reasonable down payment often find conventional financing more attractive because PMI is cheaper and cancellable.

However, FHA remains a strong option in Nashville's more affordable neighborhoods — Antioch, Donelson, Madison, Bordeaux, and parts of North Nashville — and in the outer suburbs of Rutherford, Wilson, and Sumner counties, where prices are lower and first-time buyers are more common.

FHA loan limits in Davidson County

For 2026, the FHA single-family loan limit for Davidson County is $524,225. This covers a meaningful share of Nashville purchases, particularly in more affordable neighborhoods and outer suburbs. However, buyers targeting higher-priced areas of Davidson County or Williamson County (Brentwood, Franklin) will quickly exceed this limit and need to consider conventional or jumbo financing.

Surrounding counties — Rutherford, Wilson, Sumner, and Williamson — generally share the same or similar limits. Verify current limits for the specific county with Morgan Hardy, as HUD adjusts them annually.

FHA vs. conventional in Nashville

For Nashville buyers with credit scores below 680 or down payments under 10%, FHA often provides better pricing than conventional. Above those thresholds, conventional becomes more attractive — PMI is cheaper, cancellable, and there's no upfront mortgage insurance premium.

Nashville's competitive market also creates a practical consideration: some sellers in multiple-offer situations prefer conventional offers over FHA, perceiving FHA appraisals as more likely to flag property condition issues. This isn't always accurate, but it's a real factor in competitive Nashville neighborhoods.

THDA down payment assistance with FHA

Tennessee Housing Development Agency programs can be layered with FHA financing for qualifying Nashville buyers. THDA's Great Choice program provides a second mortgage for down payment and closing cost assistance. Income and purchase price limits apply — Nashville's higher home prices mean some buyers who qualify on income may exceed the purchase price cap in certain neighborhoods.