Looking at the recent market, Chattanooga housing prices are continuing to rise gradually. According to Redfin data, the median sale price is $356,000 for the three months leading up to May 2026, which is a 4.0% increase compared to the same period last year. In this trend, it helps to outline the items to check in order to prepare for down payments and approval rates.

Based on this price, calculating the down payment shows that 3.5% is $12,460, 5% is $17,800, 10% is $35,600, and 20% is $71,200. If you put down less than 20%, PMI will apply, but the initial cash burden is significantly reduced, so it's a matter of judgment based on your financial capacity.

Another item to check is the monthly principal and interest payment. Based on a 30-year fixed rate of 6.6%, with a 5% down payment, the payment is $2,160 per month, while with a 20% down payment, it is $1,819 per month, resulting in a $341 difference each month. Property taxes and insurance are additional items added to this number.

Another point to summarize is that starting with a low down payment of 3.5% or 5% will result in ongoing PMI, while filling 20% or more allows you to start without PMI. If your credit score is between 500 and 579, an FHA loan will require a minimum of 10% down payment, so it's beneficial to first raise your score above 580 to reduce the burden of the down payment.

The effective property tax rate in Tennessee is 0.52%, which is lower than the national average. There is also no income tax, so families moving from nearby Georgia or North Carolina can feel a reduction in their tax burden. However, since tax rates vary by county, it's best to check the tax bill for each property directly for accuracy.

The Tennessee Housing Development Agency operates the Great Choice loan program along with the Great Choice Plus down payment assistance. There are two options to check. One is a forgivable second mortgage with a term of 10 years, up to $10,000, and the other is a repayable loan that supports 5% of the purchase price, up to $15,000. All applicants must have a credit score of 640 or higher, and completion of homebuyer education is a requirement. Receiving this assistance reduces the cash needed at closing, easing the asset requirement burden.

To increase approval rates, the first item to check is the credit score. A score above 780 has a rate of 6.59%, in the 760s it's 6.66%, in the 740s it's 6.75%, and in the 700s it's 6.91%. The second is the DTI, which should be below 43% for the back end, while conventional loans typically range from 36% to 45%. The third is income verification, where salaried individuals need W2s and pay stubs, and self-employed individuals need two years of tax returns.

As an example of one item to check, with a household monthly income of $7,000, it's advisable to manage principal and interest, property taxes, and insurance within $1,960, which is 28% or less of the front end, and manage other debts within $3,010, which is 43% or less of the back end.

The fourth is pre-approval. Getting this before looking at properties gives you an advantage in offer competition. The fifth is to avoid major changes before closing. New credit cards, car loans, or job changes can lead to a loan re-evaluation. The sixth is to leave several months' worth of living expenses in reserve beyond closing costs, which will be viewed favorably during the assessment.

Korean families tend to prefer school districts near Signal Mountain and Oakley Island. School district boundaries change frequently, so while referring to GreatSchools ratings, it's best to verify the actual assigned school based on the address before signing a contract. For investors looking for rental income, it's also worth considering the recent changes in rental demand due to the increase in manufacturing jobs.

This article is not investment or legal advice, and it is recommended to consult with local loan officers and real estate professionals before proceeding with any contracts or loans.