Hawaii First-Time Home Buyer Programs of 2021

By NerdWallet 
Edited by Amanda Derengowski

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Many people dream of living in Hawaii — it’s a tropical paradise with a laid-back vibe. But life in paradise can be expensive, especially for first-time home buyers.

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National mortgage options, along with programs offered by the Hawaii Housing Finance and Development Corp., or HHFDC, can make homeownership more accessible to first-time buyers in the Aloha State.

National first-time home buyer loans

These nationally available loans are often a good fit for first-time home buyers because they offer more relaxed credit score and down payment requirements.

Conventional mortgage

Best for:

Low down payments, limited mortgage insurance premiums

What you need to know:

A conventional mortgage is a home loan that isn’t guaranteed or insured by the federal government. Conventional mortgages that conform to the requirements set forth by Fannie Mae and Freddie Mac allow down payments as low as 3% for first-time buyers or lower-income home buyers. Unlike FHA loans, conventional loans allow borrowers to eventually cancel their mortgage insurance or avoid mortgage insurance altogether if they put at least 20% down.

VA loans

Best for:

Military, low down payments

What you need to know:

The U.S. Department of Veterans Affairs helps service members, veterans and surviving spouses buy homes. VA loans are especially generous, providing competitive interest rates, often requiring no down payment or mortgage insurance. Although there is no official minimum credit score, most VA-approved lenders require scores of at least 640.

FHA loans

Best for:

Low credit score, low down payments

What you need to know:

This is the go-to program for many first-time home buyers with lower credit scores. The Federal Housing Administration allows down payments as low as 3.5% for those with credit scores of 580 or higher. The FHA will insure loans for borrowers with scores as low as 500 but requires a 10% down payment for a score that low. Mortgage insurance is required for the life of an FHA loan and cannot be canceled.

USDA loans

Best for:

Low down payments, rural home buyers

What you need to know:

A USDA home loan is a zero-down-payment mortgage for eligible rural and suburban home buyers. USDA loans are issued by the U.S. Department of Agriculture through the USDA Rural Development Guaranteed Housing Loan Program. There are income limitations, which vary by region. Applicants with credit scores of 640 or higher receive streamlined processing. Those with scores below that must meet more stringent underwriting standards.

Hawaii first-time home buyer programs

The HHFDC doesn’t offer loans or down payment assistance for first-time home buyers at this time, but it does have two programs — Affordable Resale and Mortgage Credit Certificate — designed to make buying a home in Hawaii less expensive.

HHFDC highlights and eligibility requirements


  • Below market price on HHFDC-owned properties, awarded by lottery.

  • Co-mortgagor, co-signer and monetary gifts allowed.

  • Tax credits available through select lenders.


  • Must be a “qualified resident.”

  • Must meet income requirements, which vary by household size.

  • Must be pre-qualified for a home loan.

  • Must be a resident of Hawaii and live in the unit purchased.

Affordable Resale Program

Best for:

Below-market prices

What you need to know:

Qualified residents of Hawaii can buy housing units from the HHFDC at below market prices — from $250,000 for a studio to $500,000 for a three-bedroom single-family home — through the Affordable Resale Program. HHFDC defines a qualified resident as a U.S. citizen or resident alien who is at least 18 years old, lives in Hawaii, will occupy the property, has enough income to qualify for a home loan and doesn’t own a majority interest in other property or lands.

Acceptance into the Affordable Resale Program enters your name in a public lottery. If selected to buy a designated unit, it will be subject to HHFDC Buyback and Shared Appreciation Equity (SAE) program restrictions.

The Buyback program requires you to occupy the unit for the first 10 years of ownership. If you want to sell or rent the unit earlier, HHFDC retains the right to repurchase the property. There may be restrictions on refinancing in the first 10 years as well.

The SAE program requires you to repay a part of any future appreciation in value to the HHFDC in return for the benefit of purchasing at below market value.

Details for the Affordable Resale Program can be tricky to find on the HHFDC website as the page isn’t listed under “Homebuyer Resources,” but instead can be found under a tab labeled “Buyback & SAE Programs.”

Mortgage credit certificate

Best for:

Tax credits

What you need to know:

The HHFDC mortgage credit certificate program, or MCC, is open to all Hawaii qualified home buyers through select participating lenders. The MCC allows homeowners to recoup up to 20% of their annual mortgage interest as a federal tax credit. To be eligible, you must meet income and purchase price limits, which vary by county and family size.

Your next step

To learn more about any of the programs listed above, contact the HHFDC or visit the website. There, you’ll be able to request an application for the Affordable Resale Program and see lenders who participate in the MCC program.

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