The Smoky Mountains are a popular destination for tourists from all over the world. With their picturesque landscapes, endless opportunities for outdoor activities, and abundance of wildlife, it’s no wonder that the area is a hot spot for vacation rentals. If you’re interested in purchasing a short-term rental in the Smoky Mountains, there are several ways to go about it. In this post, we’ll explore three of the most common methods:

Traditional Financing

Pre-Construction Purchases

Creative/Seller Financing

Traditional Financing

Traditional financing is perhaps the most well-known method of purchasing a property. This involves obtaining a mortgage loan from a bank or other financial institution. When purchasing a short-term rental, there are a few things to keep in mind.

  • 1

    First, it’s important to have a good credit score. The higher your score, the more likely you are to be approved for a loan and the better your interest rate will be. A good credit score is generally considered to be around 700 or above.

  • 2

    Second, you’ll need to have a down payment. This is the amount of money you’ll need to put down on the property upfront. The amount required will depend on a variety of factors, such as the purchase price of the property and the lender’s requirements. Generally, you can expect to put down between 10-20% of the purchase price.

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    Finally, you’ll need to have a solid plan for how you’ll use the property as a short-term rental. Lenders will want to see that you have a plan in place for how you’ll generate income from the property, whether that’s through renting it out on a platform like Airbnb or through another means.

Pre-Construction Purchases


  • Potentially lower price than if you wait until it’s completed
  • More control over the final product
  • Input on things like finishes, fixtures, and layout


  • A chance that the project could be delayed or even canceled
  • Finished project might not meet expectations
  • Potentially difficult property to sell or rent

Another option for purchasing a short-term rental in the Smoky Mountains is to buy a property that’s still in the pre-construction phase. This means that the property hasn’t yet been built, but is being sold based on plans and specifications.

One of the advantages of buying a pre-construction property is that you may be able to get it at a lower price than you would if you waited until it was complete. Additionally, buying pre-construction can give you more control over the final product. You’ll have input on things like finishes, fixtures, and layout, which can be appealing if you have a specific vision in mind for your short-term rental.

However, there are some risks associated with pre-construction purchases. For one, there’s always a chance that the project could be delayed or even cancelled, leaving you with nothing to show for your investment. Additionally, if the finished product doesn’t meet your expectations, you may be stuck with a property that’s difficult to sell or rent out.

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Creative/Seller Financing

Finally, another option for purchasing a short-term rental in the Smoky Mountains is through creative financing or seller financing. This involves working directly with the seller to come up with a financing arrangement that works for both parties.

There are several ways that seller financing can work. For example, the seller may be willing to finance the entire purchase price, with the buyer making monthly payments to the seller instead of to a bank. Alternatively, the seller may be willing to finance a portion of the purchase price, with the buyer securing traditional financing for the remainder.

One of the benefits of seller financing is that it can be a good option for buyers who may not qualify for traditional financing. For example, if you’re self-employed or have a lower credit score, a seller may be more willing to work with you than a bank.

However, it’s important to be cautious when considering creative or seller financing. These arrangements can be more complex than traditional financing, and it’s important to work with a knowledgeable real estate attorney to ensure that the agreement is fair and legally binding.

Bottom Line:

If you’re interested in purchasing a short-term rental in the Smoky Mountains, there are several options to consider. Traditional financing, pre-construction purchases, and creative/seller financing each have their own advantages and drawbacks. It’s important to do your research and consult with professionals like real estate agents and attorneys to determine which option is best for your individual circumstances. With careful planning and due diligence, you can find a profitable short-term rental investment in this beautiful and popular vacation destination.

Rachel beasley, smoky mountain tn realtor

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