Last Updated on August 23, 2023 by Hannah Stevens
Mortgage Assistance for Homebuyers in Hawaii
County of Kaua’i Home Buyer Loan Program
The County of Kaua’i provides the Home Buyer Loan Program to help people achieve their goals of homeownership. This program provides low-interest loans for income-eligible homebuyers who live on Kaua’i.
Available Assistance
The county’s Home Buyer loan program allows first-time homebuyers to apply for GAP and primary mortgages. These loans are available to income-qualified homebuyers. However, there is a maximum loan amount for a Primary loan of $450,000.00 Moreover, the borrower’s Kaua’i Median Household Income (KMHI) is used as a basis to calculate the interest rate. It is amortized for a 30-year period, with a 15-year balloon.
In addition, GAP mortgages are limited to a loan amount of $150,000.00. The borrower’s KMHI is also used to calculate the interest rate. It will be amortized over a 30-year period, with interest-only payments the first seven (7) years.
Eligibility Requirements
The Home Buyer Loan Program is only available to U.S. citizens or resident aliens who are also first-time homebuyers. Therefore, the applicants must not have owned a majority interest in a primary residence or real estate for the past 3 years. Furthermore, they must be at least 18 years old or older, and must finish a Homebuyer Education Program. The applicant’s household income must also not exceed 80% of the KMHI in order to qualify for the program.
Property Guidelines
All homes purchased using program funds must be on the island of Kaua’i. They also need to be outside the FIRM 100-year flood boundary. The eligible properties include single-family detached dwelling, or condominium unit. In addition, it must meet the federal minimum quality standards for existing houses, and become the borrower’s primary residence.
HHOC Down Payment Assistance Loan
The Hawaii HomeOwnership Center and the HHOC Mortgage (a separate non-profit mortgage broker) offer the Downpayment Assistance Loan (DPAL) Program to individuals.
This program provides financial assistance to qualified applicants who are interested in purchasing a home, but cannot afford the upfront costs. It includes the down payment, closing costs, and prepaid items needed to acquire homeownership. These costs can be significant, and people might find themselves stuck in a renters’ trap if they are unable to pay them.
Available Assistance
The DPAL Program allows borrowers the opportunity to buy a home with a 5% down payment. Plus, with a second mortgage or down payment loan, they can avoid the requirements for mortgage insurance. The maximum loan amount for applicants is $75,000. It is fixed for a 20-year amortization, and due in 15 years. Additionally, the interest rate can be up to 2% higher than the first mortgage rate.
Eligibility Requirements
All applicants must meet specific requirements to qualify for DPAL. However, this program is only open to first-time homebuyers. So anyone who has owned a house for the past three years will not be eligible. Additionally, they need to have a mid-FICO score not less than 700.
Homebuyer Education
All applicants must complete approximately 9 hours of homebuyer education with the Hawaii HomeOwnership Center (live or online). It is also mandatory to complete one counseling session from the HHOC.
Property Guidelines
The DPAL Program requires that the property bought through them must be the applicant’s primary residence. They allow single-family homes, condominium units, or townhouses. Moreover, applicants who are putting only at least 5% down on the home, cannot exceed the determined maximum purchase price of $500,000.
This programme similar to the down payment First-Time Homebuyer Assistance Programs in Georgia.
Honolulu Down Payment Loan Program
The City of Honolulu provides individuals with the Honolulu Down Payment Loan Program to encourage homeownership and build strong communities.
Available Assistance
The applicants of this program can receive up to $40,000 in assistance funds, as a zero-fee, zero-interest loan with an amortization term of 20 years. Then, the credit qualification can reduce the minimum monthly payments. Additionally, the borrower must always be an owner occupant. However, the City of Honolulu requires the borrower to pay a certain percentage of the loan amount if the property is sold or transferred, unless the new owner is income-eligible. The loan balance is reduced for every year of occupancy. Plus, loans are granted on a first-come, first-served basis depending on the availability of funds.
Eligibility Requirements
The Honolulu Down Payment Loan Program applicants must meet certain criteria in order to be eligible. However, only first-time homebuyers can be qualified. Their annual household income must also fall within the program’s guidelines (shown below). Before applying, borrowers must take a homeowner education course approved by the City of Honolulu.
Property Guidelines
The properties purchased must be the applicant’s primary residence, and must be on Oahu. Moreover, all properties under Honolulu Down Payment Loan program must be legally permitted structures passing all local building codes. They must also pass a Housing Quality Standards inspection. Additionally, all Federal requirements must also be met, including those regarding lead-based paint for houses built before 1978 and environmental reviews.
Income Limits
All income earned by members of the household (18 years old or older) who live in the house, even if they are not part of the mortgage, define the household income.
- 1 person household: $58,600
- 2 person household: $67,000
- 3 person household: $75,350
- 4 person household: $83,700
- 5 person household: $90,400
- 6 person household: $97,100
- 7 person household: $103,800
- 8 person household: $110,500
- 9 person household: $117,200
- 10 person household: $123,880
Hula Mae Mortgage Loan Program
The Hawaii Housing Finance and Development Corporation (HHFDC) provides individuals the Hula Mae mortgage loan program. This program helps potential homebuyers gain their goal of homeownership. Moreover, the program offers affordable home loans and assistance with the down payment for a mortgage.
Available Assistance
Besides the 30-year term mortgage at very competitive interest rates, the Hula Mae Program provides income-eligible first-time homebuyers with down payment assistance up to 3% of the property’s purchase price. The interest rates on these loans can change at any time, so applicants for down payment assistance should take note of this.
Eligibility Requirements
Applicants for the Hula Mae Program must be at least 18 years old, be a resident of Hawaii, and citizens or legal immigrants of the U.S. First-time homebuyers are the target for this program. So, anyone who has ever owned a principal residence, or any beneficial interest in land trusts involving principal residences (within or outside the State of Hawaii) cannot be eligible for this program. Furthermore, the program is not available to previous recipients of the Hula Mae loan.
Property Guidelines
The properties purchased must be the applicant’s primary residence and located in Hawaii. It also has to fall within each county’s purchase price limit. Moreover, the qualified properties include new or existing single-family residences, and townhouse/condominium units.
Income Limits
The household income of applicants must meet the program’s income limits. These income limits are adjusted according to family size and county. The household income refers to all income earned by household members (18 and older) who live in the house, regardless if they are not on the mortgage.
Honolulu County
- 2 persons or less: $123,600
- 3 persons or more: $144,200
Maui County
- 2 persons or less: $107,160
- 3 persons or more: $125,020
Kauai County
- 2 persons or less: $98,880
- 3 persons or more: $115,360
Hawaii County
- 2 persons or less: $88,080
- 3 persons or more: $102,760
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