Hawaii Hula Mae Down Payment Assistance Program

The Hawaii Hula Mae Down Payment Assistance Program, managed by the Hawaii Housing Finance and Development Corporation (HHFDC), is designed to help eligible homebuyers in Hawaii reduce the financial barriers to purchasing a home. This program offers financial assistance for down payments and closing costs, making homeownership more achievable for residents across the state.

Benefits

Provides financial assistance to help cover down payments and closing costs, reducing the upfront expenses of homeownership.
Works in conjunction with the Hula Mae Loan Program to create a comprehensive support system for eligible homebuyers.
Assistance is structured as a second mortgage with low or deferred payments, depending on the terms.
Helps first-time homebuyers secure stable housing and build long-term equity in their homes.

Eligibility Requirements

Applicants must qualify for the Hula Mae Loan Program and meet its eligibility requirements.
Income limits apply, varying by household size and the property’s location, to ensure assistance is provided to those with the greatest need.
The property must be located in Hawaii and used as the buyer’s primary residence.
Applicants may be required to meet a minimum credit score, with lender-specific underwriting criteria also applying.
Completion of a homebuyer education course is mandatory to prepare for the responsibilities of homeownership.

Additional Information

The Hula Mae Down Payment Assistance Program is an essential resource for Hawaii residents who need financial help to achieve their homeownership goals. By reducing upfront costs, the program supports first-time homebuyers in creating a stable foundation for their future while promoting strong and vibrant communities throughout Hawaii.

Frequently Asked Questions About Our Program

What is the Hula Mae Down Payment Assistance Program?

The Hula Mae Down Payment Assistance Program offers eligible first-time homebuyers in Hawaii financial support to cover up to 3% of the property's purchase price, aiding in reducing the initial costs of homeownership.

Who is eligible for this assistance?

Eligibility requires applicants to be bona fide residents of Hawaii, U.S. citizens or declarant aliens, at least 18 years old, and first-time homebuyers who have not owned a principal residence or held a beneficial interest in a land trust involving a principal residence within or outside Hawaii for the past three years. Prior recipients of a Hula Mae loan are also ineligible.

What types of properties qualify?

Eligible properties include new or existing single-family residences and townhouse or condominium units located within the State of Hawaii, intended to serve as the applicant's primary residence.

Are there income limits for applicants?

Yes, applicants' annual household income must fall within set limits, which vary by county and household size. For example, in Honolulu County, the limit is $123,600 for households of two persons or less, and $144,200 for households of three persons or more.

What are the purchase price limits for properties?

Purchase price limits vary by county and are subject to change. Applicants should consult with participating lenders to determine the current limits applicable to their desired property location.

Is homebuyer education required?

While the program does not explicitly mandate homebuyer education, it is highly recommended to ensure borrowers are well-prepared for the responsibilities of homeownership.

Can the assistance be used for leasehold properties?

Yes, provided the remaining term of the lease is at least 35 years, and the lease rent is fixed for no less than 10 years from the date of the mortgage loan.

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Is there a minimum borrower contribution required?

The program does not specify a minimum borrower contribution; however, individual lenders may have their own requirements. It's advisable to discuss this with your chosen lender.

Are there any restrictions on selling a home purchased with this assistance?

Yes, if you sell or dispose of your home within nine years of purchase, you may be subject to a federal recapture tax, which could increase your federal income taxes for the year of sale, depending on the gain from the sale and your income level.

Can the assistance be used to refinance an existing mortgage?

No, the Hula Mae Down Payment Assistance Program cannot be used to refinance existing mortgages; it is intended solely for the purchase of a new primary residence.

Is mortgage insurance required?

Depending on the loan-to-value ratio and the type of loan, mortgage insurance may be required. It's important to discuss this with your lender to understand any additional costs.

Are there any fees associated with the program?

Standard loan fees, such as origination and processing fees, may apply. Applicants should consult with participating lenders to understand all potential fees involved.

Can I apply if I have previously received a Hula Mae loan?

No, prior recipients of a Hula Mae loan are not eligible to participate in the program again.

What happens if I no longer occupy the property as my primary residence?

You must occupy the property as your primary residence throughout the term of the Hula Mae Mortgage Loan or until the loan is paid in full. Failure to do so may cause the entire loan balance to become immediately due.

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Are there specific debt-to-income (DTI) ratio requirements?

While the program does not specify exact DTI ratio requirements, individual lenders may have their own criteria. It's essential to consult with your lender to understand the specific DTI requirements applicable to your situation.

Is there a deadline to apply for the program?

There is no specific deadline; however, program availability is subject to funding, so it's advisable to begin the application process as soon as you are ready to purchase a home.

Can the assistance be combined with other down payment assistance programs?

Yes, the Hula Mae Down Payment Assistance can be combined with other assistance programs, subject to approval and program guidelines. Applicants should discuss options with their lender.

Are non-occupant co-borrowers allowed?

No, all borrowers must occupy the property as their primary residence. Non-occupant co-borrowers are not permitted under this program.

What are the repayment terms for the down payment assistance?

The down payment assistance is provided as a second mortgage loan with a 0% interest rate, deferred for the life of the loan. Repayment is required upon sale, refinancing, or if the property ceases to be the primary residence.

How do I apply for the Hula Mae Down Payment Assistance Program?

To apply, you must work with a participating lender who will guide you through the application process, including verifying eligibility, assisting with necessary documentation, and explaining program requirements.