Check out our rates
Private Money Hawaii
Hard Money Loans in Hawaii: How They Work (2025)
Hawaiʻi real estate moves fast—and the strongest, cleanest offers win. Hard Money Loans give kamaʻāina buyers and investors a way to close quickly, solve condo-hotel or leasehold hurdles, and keep projects moving from Honolulu to Kīhei to Kona to Princeville. Unlike bank financing, these asset-based loans focus on your property, equity, and exit plan—so you can act decisively without waiting on mainland timelines.
What Are Hard Money Loans?
Hard Money Loans are short-term, asset-based mortgages funded by private lenders. Approval is driven primarily by the collateral (your property), equity, and a believable exit strategy (refi or sale)—not perfect credit.
Why they fit Hawaiʻi
- Condo-hotels & CPRs: Buildings in Waikīkī, Kīhei, and Princeville often sit outside bank guidelines. Hard money can bridge to long-term financing once stabilized.
- Leasehold & unique properties: Private underwriting can price risk and move forward where conventional loans stall.
- Island timing: Permits, materials, and shipping introduce “island time.” Asset-based funding keeps momentum while you execute.
How Hard Money Loans Work (Step by Step)
1) Prequal (often 24–48 hours with a clean file)
You submit a purchase contract (or payoff for refi), recent photos, a scope of work & budget, your exit plan (VA/conventional/DSCR refi or sale), entity docs (LLC/Trust), IDs, and proof of funds. A lender familiar with Oʻahu, Maui, Big Island, and Kauaʻi will flag any condo-hotel, leasehold, or lava/flood items early.2) Valuation suited to the asset
Depending on risk and loan size, lenders order a BPO or appraisal—often using specialists for condotels/CPRs. Right-sizing value at the start prevents re-trades and keeps escrow smooth.3) Clear escrow & title coordination
Hawaiʻi is escrow-centric. Your lender, escrow officer, and agent coordinate HOA docs, leasehold terms (ground rent/reversion), permits, and county-level recordings (interisland shipping can add a few days).4) Funding & rehab draws
With a complete file, many deals fund in about a week. Rehab money is released in draws after inspections—so contractors stay paid and your cash isn’t tied up.
Hard Money Loans 2025: Rates, Terms & Fees
Typical pricing (deal-dependent)
- Interest: ~9–14%, shaped by leverage, island, and property type
- Points: 1–4+ upfront based on speed/complexity
- Fees: Processing/underwriting plus escrow, title, BPO/appraisal (get an all-in sheet upfront)
Leverage & structure
- Purchase LTV: ~60–75% of purchase price
- ARV programs: Often 65–70% of after-repair value with a vetted scope & comps
- Payments: Usually interest-only to preserve cash flow during rehab/stabilization
- Term: 6–18 months, with 3–6 month extensions available (fee applies)
Prepay flexibility
Many programs remove prepayment penalties after 3–6 months, letting you refinance or sell as soon as your plan comes together.
Pros & Cons (Honest Trade-offs for Hawaiʻi Borrowers)
Pros
- Speed that wins offers: Same-week closings help you beat financed buyers in Honolulu, Kailua, and Kakaʻako.
- Flexible on asset types: Condo-hotels (Waikīkī/Kīhei), leasehold, CPR parcels, and unique properties get real consideration.
- Underwriting built for reality: Focus on collateral and exit—not a rigid credit box.
- Cash-flow friendly: Interest-only payments and staged draws support contractors and timelines.
Cons
- Higher cost of capital: Rates and points are above bank loans—budget them into your deal math.
- Short terms: You must execute your exit on schedule (refi or sale).
- Stricter leverage: Lower LTVs mean meaningful equity or a stronger partner is needed.
- Discipline required: Scope creep and island delays can erode profits if you don’t plan buffers.
Best Uses in Hawaiʻi (Where Hard Money Shines)
Bridge to long-term financing
Close fast now; refinance to VA, conventional, or DSCR after rents stabilize or renovations complete. Perfect when condo-hotel matrices or appraisal timelines would otherwise cost you the deal.Fix-and-flip or light value-add
Target Kailua, Kāne‘ohe, Mililani, and close-in Honolulu—plus beach-adjacent Kīhei and resort-proximate Princeville. Predictable draws keep crews moving; interest-only payments protect cash.Condo-hotel & CPR solutions
Choose a hard money loan lender fluent in daily rental programs, HOA reserves, and CPR boundaries. Clarity on building rules reduces underwriting friction.ʻOhana/ADU additions
Finance plans and build-out to boost DSCR and long-term affordability for your ʻohana. Coordinate DPP early on Oʻahu; refi to permanent financing once the unit is rentable.Land, leasehold & unique assets
Some programs fund land or leasehold at conservative LTVs with a documented exit. Prepare utility/access details and lease terms so pricing is fair and timelines are realistic.Simple Deal Math (Use This to Sanity-Check Offers)
Max Offer ≈ (ARV × Allowed ARV-LTV) − Rehab − Carry/Fees − Profit target
- Stress-test exits: Refi DSCR, flip DOM, seasonal rental swings
- Add buffers: Permits, materials, weather; island time is real—plan for it
- Know your breakeven: Model a 10–20% delay or cost overrun and ensure you still win
How to Choose a Hard Money Lender in Hawaiʻi
Local closings you can verify
Ask for recent deals in your building/neighborhood (e.g., Waikīkī condotels, Kīhei ocean-adjacent projects, Kona CPR parcels). Proof beats promises.One-page, all-in numbers
Insist on a clear term sheet listing rate, points, fees, draws, extensions, prepay—no surprises at wire time.Communication that lowers stress
Expect same-day updates during escrow, direct access to decision-makers, and a Hawaiʻi-based processor who understands island logistics.Fit for your plan
Some hard loan lenders excel at condo-hotels; others are built for ADU draws or land. Match their niche to your strategy and timeline.Conclusion: Move Like a Local – With Confidence
When the right property appears, you can’t wait on mainland timelines. Hard Money Loans let you move first, solve Hawaiʻi-specific hurdles, and execute your plan with calm, clear steps. Request a Hawaiʻi-specific term sheet and free deal review today – so you can fund with confidence and aloha.FAQs (Straight Answers for Local Borrowers)
Can I qualify with thin or bruised credit?
Often, yes. Asset strength, equity, and a believable exit outweigh a perfect FICO. Pricing may adjust to risk.Do lenders fund leasehold?
Some do—at lower LTVs and with lease terms that outlast your loan and exit. Be ready with ground rent, reversion dates, and HOA docs.What about lava/flood/hurricane zones?
Expect insurance checks, possible reserves, and conservative leverage—especially on the Big Island and coastal areas. Get quotes early to avoid delays.How fast can I close on Oʻahu?
With a complete file and cooperative vendors, about a week is realistic; unique condo-hotel/CPR or title issues can add a few days.Are foreign nationals or non-residents eligible?
Often yes—with higher down payments and verifiable reserves. A local lender will outline exactly what’s needed.Offering Rates Starts at 9%
At Private Money Hawaii, we are proud to fund commercial properties, multi-family residential, investment residential properties, fix and flip projects, land, and construction in Honolulu and across the Hawaii Islands.
Ready for a Honolulu Hard Money Loan? Fast, Flexible Financing Across Hawaii
Act Fast with a Trusted Local Partner
Secure funding in as little as 7–14 days. No bank delays—just Honolulu hard money loans designed for investors who need speed and certainty.
Tailored Loan Programs
From fix-and-flip loans in Oʻahu to bridge loans in Honolulu, DSCR rental financing, and construction loans across Hawaii, we customize terms around your project’s needs. With interest-only payment options, LTV up to 70%, and clear origination fees, you’ll have flexible funding that works for you.
Local Expertise You Can Trust
Led by veteran lender David Ige, with nearly 30 years of experience funding Hawaii investment property loans, we combine deep local insight with transparent terms to help investors succeed.
Private Money Hawaii
Address: 411 Hobron Ln #3912, Honolulu, HI 96815
Call: +1(808) 753-1204
Email: funding@privatemoneyhawaii.com
Looking for a reliable private money lender in Hawaii for your next real estate investment loan?
PRIVATE MONEY HAWAII
helping borrowers obtain financial goals