On May 7, 2026, three Hawaii families closed on their homes at 4.65% on a 30-year fixed mortgage. Not a teaser rate. Not a 2/1 buydown that expires in Year 3. Not a variable-rate product. A genuine 30-year fixed rate that is 1.28 percentage points below the current market rate for FHA and VA loans — and 1.45 points below market for conventional.
The program making this possible is the Hale Kamaʻāina Mortgage Program, launched by the Hawaii Housing Finance and Development Corporation (HHFDC) in December 2025. It is the revival of a program that was dormant for 12 years — the former Hula Mae Single Family Mortgage Program — now reborn with modern underwriting standards and a $30 million bond allocation.
If you are a first-time buyer in Hawaii and you are not actively pursuing this program right now, you are leaving money on the table. Here is everything you need to know.
What Is the Hale Kamaʻāina Mortgage Program?
Hale Kamaʻāina (which translates roughly to "local resident's home") is a tax-exempt mortgage revenue bond program administered by HHFDC. The state issues tax-exempt bonds, which carry lower interest rates than taxable bonds, and passes those savings directly to eligible first-time homebuyers in the form of below-market mortgage rates.
This structure is not new — similar programs exist in most states — but Hawaii's program had been inactive since approximately 2013. The December 2025 relaunch represents the first time in over a decade that Hawaii residents have had access to this type of subsidized rate.
The program offers a 30-year fixed-rate mortgage at rates set by HHFDC based on current bond market conditions, optional down payment assistance (DPA) of up to 4% of the purchase price, eligibility for FHA, VA, USDA-RD, and conventional (Fannie Mae HFA Preferred / Freddie Mac HFA Advantage) loan products, and a $3,000 closing cost incentive for the first 35 homebuyers who close (available as of February 2026).
The Rates: What 4.65% Actually Means at Hawaii Price Points
As of May 7, 2026 — the date of the first three closings — the Hale Kamaʻāina rates are:
| Loan Type | Hale Kamaʻāina Rate | Current Market Rate | Rate Advantage |
|---|---|---|---|
| FHA / VA / USDA | 4.65% | 5.93% | −1.28 pts |
| Conventional | 4.95% | 6.40% | −1.45 pts |
To understand what this means in practice, consider a buyer purchasing a $650,000 condo in Honolulu with FHA financing (3.5% down, $627,250 loan amount):
| Scenario | Rate | Principal & Interest | Monthly Difference |
|---|---|---|---|
| Hale Kamaʻāina FHA | 4.65% | $3,231/mo | — |
| Market Rate FHA | 5.93% | $3,730/mo | +$499/mo |
That is $499 per month — $5,988 per year — in savings on a single $650,000 purchase. Over the first five years, the savings total nearly $30,000.
For a VA buyer purchasing at $850,000 with no down payment:
| Scenario | Rate | Principal & Interest | Monthly Difference |
|---|---|---|---|
| Hale Kamaʻāina VA | 4.65% | $4,376/mo | — |
| Market Rate VA | 5.93% | $5,049/mo | +$673/mo |
The monthly savings of $673 on an $850,000 VA purchase translates to $8,076 per year — and critically, it can be the difference between qualifying and not qualifying. At 5.93%, a buyer needs approximately $148,000 in gross annual income to qualify for this payment (assuming 43% DTI and $500/month in other debts). At 4.65%, that income requirement drops to approximately $128,000 — a $20,000 difference in required income.
For a conventional buyer at $750,000 with 5% down ($712,500 loan):
| Scenario | Rate | Principal & Interest | Monthly Difference |
|---|---|---|---|
| Hale Kamaʻāina Conventional | 4.95% | $3,797/mo | — |
| Market Rate Conventional | 6.40% | $4,452/mo | +$655/mo |
The First Three Closings: Ashley Maeshiro's Story
On May 7, 2026, HHFDC celebrated the program's first three closings at an event in Kakaʻako. Among the homebuyers was Ashley Maeshiro, a public school teacher who purchased a one-bedroom condominium in Makiki.
"As a public school teacher, Hawaiʻi is where I've chosen to build my life and give back, so being able to put down roots here as a homeowner means everything to me. I'm incredibly grateful to HHFDC and to my loan officer, Brian Ako at American Savings Bank, for taking such great care of me and helping me make my first home a reality."
Maeshiro's story is exactly the profile this program was designed for: a local resident with stable income who earns too much for affordable housing programs but faces genuine affordability challenges at market rates. The other two closings were Mhel and Maureen Nacapuy, who purchased a three-bedroom townhome in Mililani, and a buyer who purchased a two-bedroom condominium in downtown Honolulu.
All three loans were originated through American Savings Bank, the first participating lender to close loans under the program. Governor Josh Green attended the ceremony, stating: "This milestone is a true reflection of the state's commitment to help Hawaiʻi families with homeownership."
Who Qualifies: Eligibility Requirements
To qualify for the Hale Kamaʻāina Mortgage Program, a borrower must meet all of the following criteria according to the official HHFDC eligibility document (updated January 15, 2026):
- U.S. citizen or resident alien
- Bona fide resident of Hawaii
- At least 18 years of age
- First-time homebuyer: Has not owned or occupied a principal residence in the past three years. (Veterans and buyers in targeted census tracts may be exempt from this requirement.)
- Household income within program limits (see tables below)
- Purchase price within program limits (see tables below)
- Maximum DTI of 45%
- Completion of a HUD-approved homebuyer education course
- Must occupy the home as primary residence within 60 days of closing
For the down payment assistance component only, two additional requirements apply: the borrower cannot own any other residential property in Hawaii, and cannot have previously received DPA from HHFDC programs.
First-Time Buyer Exceptions
The three-year lookback rule has important exceptions. Buying in a federally designated targeted census tract waives the three-year requirement, though you still cannot currently own and occupy another primary residence. Military veterans who do not currently own and occupy a primary residence qualify regardless of prior ownership history. Owning rental or investment property that was never your primary residence does not disqualify you.
Eligible Property Types
Single-family homes, condominiums, townhomes, and planned unit developments (PUDs) all qualify. The home must be in livable condition with at least 30 years of remaining useful life. Leasehold properties may qualify if the lease has at least 35 years remaining and lease rent is fixed for at least 10 years.
Income Limits by County
Household income limits are updated annually by HHFDC. The following limits are effective as of January 2026. Income is calculated based on all household members 18 or older who will live in the home — not just the borrowers on the loan.
| County | Non-Targeted: 1–2 Person HH | Non-Targeted: 3+ Person HH | Targeted: 1–2 Person HH | Targeted: 3+ Person HH |
|---|---|---|---|---|
| Hawaii (Big Island) | $123,000 | $141,450 | $147,600 | $172,200 |
| Honolulu (Oʻahu) | $152,000 | $174,800 | $182,400 | $212,800 |
| Kalawao | $133,080 | $155,260 | $147,600 | $172,200 |
| Kauai | $159,480 | $186,060 | $159,480 | $186,060 |
| Maui | $161,520 | $188,440 | $161,520 | $188,440 |
A co-signer who will not occupy the property is excluded from the income calculation, which can be useful for buyers who need a non-occupant co-borrower to strengthen their credit profile.
Purchase Price Limits by County
Purchase price limits are also updated annually. As of January 2026:
| County | Non-Targeted Areas | Targeted Areas |
|---|---|---|
| Hawaii (Big Island) | $593,364 | $725,222 |
| Honolulu (Oʻahu) | $809,458 | $989,337 |
| Kalawao / Maui | $1,141,360 | $1,394,995 |
| Kauai | $1,153,299 | $1,409,587 |
For most Oʻahu buyers, the $809,458 non-targeted limit covers a wide range of condominiums and townhomes. Buyers in targeted census tracts — which include portions of Downtown Honolulu, Chinatown, Kalihi, and other historically underserved neighborhoods — can purchase up to $989,337.
Note that the Maui and Kauai limits are substantially higher than Honolulu's, reflecting the extreme price appreciation those markets have experienced. A first-time buyer on Maui can use this program on purchases up to $1.14 million in non-targeted areas.
The Down Payment Assistance Component
The optional DPA loan provides up to 4% of the purchase price (or appraised value, whichever is lower) as a second mortgage with the following terms: 1% simple interest (not compound), no monthly payments required, and repayment triggered by sale, refinance, transfer of ownership, or maturity of the first mortgage.
After 10 years of compliance — maintaining primary residence and following program rules — the accrued interest may be forgiven. However, the principal is never forgiven and must always be repaid upon sale or refinance.
For a $650,000 purchase, the maximum DPA is $26,000. At 1% simple interest over 10 years, the total accrued interest would be approximately $2,600 — potentially forgiven if you remain in compliance. The principal $26,000 is always due upon sale.
This DPA structure is most valuable for buyers who are income-qualified but cash-constrained. If you are a VA buyer with no down payment requirement, you may not need the DPA component at all — but you can still access the below-market rate.
How It Stacks With Other Programs
The Hale Kamaʻāina rate can be combined with other Hawaii homebuyer assistance programs.
Mortgage Credit Certificate (MCC): The MCC provides a federal tax credit equal to 20% of the annual mortgage interest paid, reducing your federal income tax liability dollar-for-dollar. An MCC can be layered on top of the Hale Kamaʻāina rate, providing both a lower rate and an annual tax credit. Consult with a tax advisor to confirm eligibility.
Seller concessions: Nothing prevents a Hale Kamaʻāina borrower from also negotiating seller concessions to cover closing costs or additional discount points. For FHA borrowers, sellers can contribute up to 6% of the purchase price. For VA borrowers, up to 4%. For conventional, up to 3–6% depending on down payment. See our guide on how to use seller concessions to buy down your rate in Hawaii for the full framework.
$3,000 Closing Cost Incentive: As of February 2026, HHFDC approved an additional incentive of up to $3,000 for the first 35 homebuyers who close under the program. As of the May 7 ceremony, only three buyers had closed — meaning 32 of the 35 incentive slots remain available.
The Recapture Tax: What You Need to Know
Because the program is funded through federal mortgage revenue bonds, it includes a potential recapture tax if you sell within 9 years. You may owe this tax only if all three of the following conditions are met simultaneously: you sell the home within 9 years of purchase, your income at the time of sale exceeds the federal recapture income limit, and you realize a gain on the sale.
If any one of these three conditions is not met, there is no recapture tax. HHFDC provides a recapture tax notice at closing that explains the calculation. For most buyers who plan to stay in their home for more than 9 years — or whose income does not increase dramatically — the recapture tax is not a practical concern.
How to Apply: Step by Step
Step 1: Confirm eligibility. Review the income and purchase price limits for your county. If you are not sure whether a property is in a targeted area, check the HHFDC targeted area census tract list at dbedt.hawaii.gov/hhfdc/hk-mortgage-program/.
Step 2: Complete a HUD-approved homebuyer education course. This is required before closing. Courses are available online through providers like eHome America and Framework. Allow 6–8 hours to complete the course.
Step 3: Find a participating lender. As of May 2026, approximately six lenders are enrolled and trained to originate Hale Kamaʻāina loans. American Savings Bank has confirmed participation and has already closed the first three loans. The full list of participating lenders is on the HHFDC website.
Step 4: Get pre-approved. The lender will review your income, credit, and assets against both the standard loan guidelines (FHA, VA, conventional) and the Hale Kamaʻāina program requirements. Pre-approval under this program works the same as any other mortgage pre-approval.
Step 5: Find a property within the purchase price limits. Work with your real estate agent to identify properties that fall within the program's county-specific purchase price limits.
Step 6: Close your loan. The lender coordinates with HHFDC and The Money Source (TMS), the master servicer, to fund the loan at the program rate.
Act Now: Bond Funds Are Finite
This is the most important thing to understand about the Hale Kamaʻāina program: the $30 million bond allocation is finite. When the bonds are fully committed, the program closes until HHFDC issues a new bond series. There is no guarantee of when — or whether — the next series will be issued at comparable rates.
The program launched in December 2025. As of May 7, 2026 — five months later — only three loans have closed. That suggests the pipeline is still early and funds remain available. But the pace of closings will accelerate as more buyers and agents become aware of the program, and as more lenders complete their onboarding and training.
For context on how much income you need to qualify at these price points, see our analysis of what income you actually need to buy a home in Hawaii in 2026. For buyers using FHA financing, our FHA loans Hawaii guide covers the full underwriting requirements. For military buyers, the VA loans Hawaii guide explains how to combine VA benefits with the Hale Kamaʻāina rate. For buyers considering down payment assistance alongside seller concessions, see our down payment assistance Hawaii guide.
If you want to explore whether you qualify, contact Jay Miller at CMG Home Loans — NMLS #657301 — for a no-obligation review of your eligibility and a rate comparison at your specific purchase price and loan type.
Sources: Hawaii Housing Finance and Development Corporation (HHFDC), Maui Now (May 10, 2026), eHousingPlus HHFDC Income and Purchase Price Limits (January 30, 2026), HHFDC Eligibility Requirements (January 15, 2026), Team Wong Hawaii (November 2025), NCSHA (February 2026)
Last Updated: May 2026
