Mortgage Rates in Hawaii

A mortgage: the agreement that a bank or other creditor will lend you thousands of dollars to make your Hawaii home purchase a reality. But this loan comes at an expense to the borrower, often in the form of a single-digit percentage mortgage rate. Mortgage rates in Hawaii fluctuate, with different lenders and brokers offering different mortgage rates and deals. And a mortgage rate difference of 0.25% can often equate to thousands of dollars over the life of a home loan.

Mortgage Rates Hawaii

Different loans have different rates and different Hawaii mortgage lenders and brokers can offer different interest rates as well. Check out the latest Hawaii mortgage rates, realizing that the rates and terms may vary, and potential borrowers should check with the lenders for details.

Choosing a Mortgage Company

It is important to shop around for the best mortgage companies in Hawaii to secure a low-interest rate, as this could save or cost you thousands of dollars.

For example, let’s say you purchased an $800,000 single-family home and had a down payment of $160,000 (20%). You secured a 30-year conventional mortgage loan. Here is the difference in the amount of total interest you would pay for different rates if you paid the minimum monthly mortgage payment:

Annual Interest Rate (%)Total Interest Paid Over 30 YearsTotal Cost of Mortgage
4 $469,965.00$1,099,965.60
3.75$427,018.40$1,067,018.40
3.5$394,600.40$1,034,600.40
3 $331,377.20$971,377.20

A 1% difference in the mortgage rate is a cost of over $100,000 during a 30-year-loan! Therefore, it is important to choose your Hawaii mortgage lender or broker wisely.

After you have closed on your home and secured your mortgage loan and rate, if the mortgage rates go down, you can often refinance to that lower rate. Refinance mortgage rates in Hawaii will vary, and you will need to go through a similar loan application process and might even need to have an appraisal of your home to see if you qualify for the new refinanced mortgage loan.

Top Tips in Choosing the Mortgage Companies in Hawaii

#1. What credit score do you need to get a mortgage?

To qualify for a home loan from a mortgage company, you need to have a certain credit score, a certain income for the amount of loan you need, and can only have a limited amount of debt. The higher your credit score, the better mortgage loan you can typically qualify for. A score under 580 might exclude you from securing a loan from any lender.

To raise your credit score and the amount the bank will lend you, pay off debts and credit cards. Check your credit score with companies like Equifax, Experian, and Transunion to see what else you can do to raise your credit score.

#2. Should you get a mortgage from the bank or a broker?

Before deciding on your Hawaii mortgage lender, know the different options available in the mortgage world. Various types of home lenders want to have your mortgage business:

  • Credit unions can only be joined by people with certain connections and often can give low mortgage rates to members. Hawaii State Federal Credit Union, for example, can be joined if you work for the state or county government and a few other industries.
  • Savings banks are often locally focused, like the Bank of Hawaii, and offer Hawaii mortgage loans themselves. They often compete against each other, offering competitive mortgage rates.
  • Mortgage bankers are people who work for certain financial institutions and package loans for borrowers while working with the bank’s mortgage underwriters. The mortgage banker uses its own money to make loans but will often sell the mortgages to large investors after the mortgage is made.
  • Mortgage brokers bring borrowers and lenders together for the real estate loan. They do not typically use their own money but rather process loan applications and work with many lenders to make mortgage loans. Mortgage brokers often know the best rates among a variety of companies and can find a mortgage for all types of home buyers. They are often paid by the borrower or the mortgage company when the loan is financed.
  • Correspondent lenders are not often banks but are instead mortgage loan companies that have additional resources to finance your loan. They sometimes rely on larger financial institutions to whom they sell your loan after giving it to you.

#3 Where can I find the best mortgage companies in Hawaii?

Search for the best mortgage rates in Hawaii by going online and calling the companies. Realize that the mortgage rate you might initially see is an estimate, and you will only know the final interest rate after they process the application and lock in a rate. Once you have about five quotes, compare the costs and decide which one makes sense for you. Realize you sometimes can still negotiate different terms as well.

Here are two mortgage lenders Hawaii to contact:

  1. Bank of Hawaii makes the most residential loans in the State of Hawaii and offers a number of options.
  2. First Hawaiian Bank is Hawaii’s oldest and largest bank and is rated highly for refinancing.

Alternatively, you can find a mortgage broker in Hawaii that you trust. This mortgage broker’s job is to compare Hawaii mortgage rates and companies for you to find the best fit for your financial situation.

Here are two mortgage brokers Hawaii to contact:

  1. Hawaii Mortgage Experts has many experienced mortgage brokers along with a full in-house processing staff that makes securing the best mortgage loan and rate seamless.
  2. Aloha Lending Services can assist with all types of loans, including VA, FHA, USDA, and conventional. They are family-run and have a good reputation locally.

#4 What questions should I ask when deciding on a mortgage loan?

Whichever mortgage company in Hawaii you choose, be sure you ask these questions up front in the process to ensure a smooth transaction in getting your low Hawaii mortgage rate:

  • How long does it typically take to get pre-approved, do the appraisal, and close on the mortgage loan?
  • What are your lender fees? Do I have to pay commission, loan origination, points, appraisal fees, credit report fees, or application fees?
  • How will I pay for the fees? Will you waive any of them? Will the fees roll into my mortgage?
  • What down payment amount is required?
  • How do you prefer to communicate with clients – text, in person, email? How quickly do you typically respond?

Choosing the right mortgage company when purchasing property in Hawaii is particularly important, as the mortgage rate you secure is often a multi-thousand-dollar decision. Contact lenders directly as well as mortgage brokers. Ask questions. Refinance when it makes fiscal sense. You can secure a great Hawaii mortgage rate to make your real estate dreams a reality.