One of the biggest barriers to homeownership in Hawaii is the down payment. With median home prices well above the national average, even a modest 3.5% down payment can represent a significant sum. Fortunately, several assistance programs exist to help bridge this gap.
HHFDC Hale Kama'aina Mortgage Program
The Hawaii Housing Finance and Development Corporation (HHFDC) offers the Hale Kama'aina program, which provides below-market interest rates and optional down payment assistance for eligible Hawaii residents. Key features include competitive fixed interest rates below conventional market rates, down payment assistance available as a second mortgage, income limits based on area median income, and availability for first-time and repeat buyers who meet income requirements.
Honolulu Down Payment Loan Program
The City and County of Honolulu offers a down payment assistance program that can provide eligible applicants with up to $40,000 in assistance. This comes as a zero-fee, zero-interest loan with a 20-year term, making it one of the most generous municipal programs in the state.
Eligibility requirements include being a first-time homebuyer (or not having owned a home in the past 3 years), meeting income limits, purchasing a home within the City and County of Honolulu, and completing a homebuyer education course.
FHA Down Payment Sources
FHA loans allow down payment funds from several sources including gift funds from family members (with proper documentation), employer assistance programs, state and local government programs, and non-profit organizations.
VA and USDA Zero-Down Options
For eligible borrowers, VA loans and USDA loans offer 100% financing — meaning no down payment at all. VA loans are available to veterans, active-duty service members, and eligible spouses. USDA loans are available for properties in designated rural areas of Hawaii.
Strategies to Maximize Assistance
Combine programs where allowed — for example, using HHFDC financing with a Honolulu down payment loan. Complete required homebuyer education courses early, as many programs require them. Work with a lender experienced in Hawaii assistance programs who can identify all available options for your situation.
Getting Started
The landscape of down payment assistance programs changes regularly. Contact a knowledgeable Hawaii mortgage lender to get current information on available programs and determine which ones you qualify for. Starting this research early gives you the best chance of taking advantage of every available resource.