VA loans work the same way in Hawaii as anywhere else, but a few things come up here more than on the mainland: high prices, leasehold land, condos that need VA approval and termite inspections. Here’s what to know before you write an offer.
Loan limits
If you have full entitlement, there’s no VA loan limit. You can borrow as much as a lender will approve and the appraisal supports, with no down payment. That’s been true since Jan. 1, 2020.
If you still have a VA loan open, or your entitlement hasn’t been restored, the county conforming limit sets how much VA will guarantee without a down payment. For 2026:
| County | 1-unit limit |
|---|---|
| Honolulu (Oahu) | $1,249,125 |
| Hawaii (Big Island) | $1,249,125 |
| Kauai | $1,249,125 |
| Maui and Kalawao | $1,299,500 |
VA guarantees up to a quarter of that limit, minus the entitlement you’ve already used. If the loan goes past what your remaining entitlement covers, lenders typically ask for a down payment on the difference. The 2027 limits are usually announced in late November.
Funding fee
| Down payment | First use | After first use |
|---|---|---|
| Less than 5% | 2.15% | 3.3% |
| 5% to less than 10% | 1.5% | 1.5% |
| 10% or more | 1.25% | 1.25% |
The fee is a percentage of the loan and can be rolled into it. You don’t pay it if you receive VA disability compensation, are a surviving spouse receiving DIC, have a pre-discharge rating that makes you eligible for compensation, or are an active-duty member with a Purple Heart.
Leasehold property
In parts of Oahu, especially some condo buildings, you buy the building or unit but lease the land. VA will lend on leasehold, but the lease has to run at least 14 years past the end of the loan. On a 30-year loan, that means about 44 years left on the lease at closing. Check the lease term, and when the lease rent is next renegotiated, before you make an offer.
Condos
The condo building needs VA approval. Look it up in VA’s condo report by name or city, and check the status field, since rejected and withdrawn buildings show up too. If a building isn’t listed, the association or your lender can submit it, but that takes time.
Inspections and appraisals
- Termites: Hawaii is on the list of states where VA usually requires a termite (wood-destroying insect) inspection. Since 2022 the buyer is allowed to pay for it.
- Catchment water: on parts of the Big Island and other rural areas, homes use rainwater catchment instead of county water. VA has allowed loans on catchment homes since 2014, but the water has to be tested by a state-certified lab.
- Appraisal: the VA appraiser sets the “reasonable value.” If it comes in under the price, you can renegotiate, pay the difference in cash or walk away.
Costs: what you can and can’t pay
- Lenders can charge a flat fee of up to 1% of the loan for their own costs, plus normal items like the appraisal, title insurance, recording fees and prepaid taxes and insurance.
- Seller concessions are capped at 4% of the VA appraised value. Normal seller-paid closing costs don’t count toward that cap.
- Under a VA circular issued in 2024, you’re allowed to pay your own buyer’s agent. That fee can’t be financed into the loan. If the seller pays your agent’s fee instead, it doesn’t count as a concession.
- In Hawaii, the seller customarily pays the state conveyance tax.
Property tax breaks for disabled veterans
Each county sets its own property tax rules. All four have a home exemption for owner-occupants and an extra break for veterans with a high disability rating:
- Honolulu (Oahu): a home owned and lived in by a totally disabled veteran is exempt from property tax, except special assessments. The regular home exemption is $120,000 under age 65 and $160,000 at 65 and older. File by Sept. 30.
- Kauai: veterans rated 80% or more disabled pay only the $150 minimum tax on their home. Veterans under 80% get a $50,000 exemption. The home exemption is $220,000 to $260,000 depending on age. File by Sept. 30.
- Maui County: there’s an exemption for veterans rated 70% or more disabled. The home exemption takes $300,000 off the assessed value. Service members stationed in the county can attach their orders instead of filing a Hawaii resident tax return. File by Dec. 31.
- Hawaii County (Big Island): a totally disabled veteran’s home is exempt except for special assessments and the minimum tax. Check with the county’s Real Property Tax Office for current amounts.
For BAH rates and what homes cost near each base, see our Hawaii military housing guide.
Sources
- VA home loan limits, VA.gov, updated Aug. 12, 2025
- FHFA announces conforming loan limit values for 2026, Federal Housing Finance Agency, Nov. 25, 2025
- Conforming loan limits by Hawaii county, American Savings Bank
- VA funding fee and loan closing costs, VA.gov, updated Oct. 5, 2026
- 38 CFR 36.4354, Estate of veteran in real property, eCFR via Cornell LII
- 38 CFR 36.4313, Charges and fees, eCFR via Cornell LII
- VA condo report (approved condo lookup), U.S. Department of Veterans Affairs
- VA Circular 26-24-14, payment of buyer-broker charges, June 11, 2024
- VA termite and pest inspections, Veterans United, updated Sept. 25, 2026
- VA reverses policy: loans for homes on catchment OK, Big Island Now, Feb. 19, 2014
- Totally disabled veteran exemption, Form E-8-10.5, City & County of Honolulu, rev. Aug. 2026
- Home exemption brochure, City & County of Honolulu, Dec. 2025
- Exemption and tax relief information, County of Kauai
- Disability exemption for disabled veterans (DFT-475), County of Maui, rev. Dec. 10, 2025
- Home exemption claim form, County of Maui, rev. Dec. 10, 2025
General information as of October 2026, not legal, tax or financial advice. VA rules change. Confirm rates and rules with your housing office, your lender and the VA before you make a decision.