Private Money Hawaii

Land Loans in Hawai‘i: Hard Money Options for Vacant & Rural Property

Financing land in Hawai‘i is completely different from financing a home. Whether you’re buying a rural parcel in Puna, a vacant lot on Maui, an off-grid farm lot in Haʻikū, or an oceanview lot on Kaua‘i, traditional lenders often refuse to finance land—especially unimproved, off-grid, or lava zone properties.

That’s where hard money land loans come in.

As a local Hawaii hard money lender, I routinely fund land deals statewide. This guide will walk you through how land loans work in Hawai‘i, why hard money is often the best option, what down payment you’ll need, and what challenges are unique to our islands.

Why Land Loans in Hawai‘i Are Harder to Get From Banks

If you’ve already tried getting a land loan through a bank, you probably heard something like:

• “We don’t lend in lava zones.”
• “The land doesn’t have utilities.”
• “There aren’t enough comparable sales.”
• “The property is too rural.”
• “We need building plans before approval.”
• “We don’t fund agricultural land.”

Banks consider raw land higher risk than homes because land doesn’t generate income and can take much longer to sell.

In Hawai‘i, the challenges are amplified by:

Lava zones

Especially Zones 1–2 on the Big Island.

Off-grid parcels

Lacking electricity, water, and sewage.

Rural zoning

Large agricultural parcels or CPRd farm lots.

Unimproved roads

Unpaved access or unclear easements.

Limited comps

Rural areas often lack recent sales data.

This is why hard money lenders play a critical role in Hawaii land financing.

What Is a Hard Money Land Loan?

A hard money land loan is a short-term, asset-based loan used to purchase land quickly—even when banks decline the property.

These loans are ideal for:

• Vacant land
• Unimproved rural lots
• Oceanview parcels
• Agricultural land
• Lava zone properties
• CPR farm parcels
• Lots without utilities
• Land intended for future building
• Subdividable lots
• Off-market land deals

These loans close quickly and rely on equity, not building plans or permits.

Why Hard Money Is the Best Option for Hawaii Land Loans

Here’s why hard money works when traditional lenders don’t:

1. No utilities required

Hard money lenders will finance lots without:

• County water
• Electrical access
• Septic or cesspool
• Paved road access

This is extremely important for rural areas like:

• Puna
• Ocean View Estates
• Kalaheo
• Haʻikū
• Hana
• North Shore Kaua‘i

2. Lava zones are accepted

Banks decline lava zones automatically. Hard money lenders evaluate:

• Actual neighborhood demand
• Insurance options
• Local resale data

We routinely fund properties in Lava Zones 1–2.

3. Fast closing (5–12 days)

If you’re buying off-market or dealing with a motivated seller, you can close quickly—without waiting weeks for underwriting or appraisals.

4. No building plans required

You are not forced to:

• Provide architectural drawings
• Submit permits
• Show construction timelines
• Have a builder chosen

This gives you flexibility.

5. No income verification

Land loans are based on:

• The value of the land
• Your down payment
• Your exit strategy

No W-2s, no tax returns.

6. Perfect for buy-and-hold or build-later strategies

Many buyers want to:

• Buy land now
• Hold for appreciation
• Build later when ready

Hard money supports this long-term vision.

Typical Hawaii Hard Money Land Loan Terms

Loan Term:

12–24 months

Interest Rate:

10–14%

Points:

2–4 points

Down Payment:

40–50% depending on:

• Lava zone
• Utilities
• Access
• Comparable sales
• Island location

Closing Speed:

5–12 days

Property Types Eligible:

• Vacant lots
• CPRd land
• Ag land
• Oceanview land
• Lava zone parcels
• Unimproved rural lots
• Land with old/teardown structures