How VA assumable loans work in Hawaiʻi

An assumable VA loan lets a buyer take over the seller's loan. That includes the seller's interest rate.

Here is how it works.

Who has to say yes

The loan servicer has to approve the buyer. That is the company that collects the payments.

Approvals can take longer than a normal purchase. Plan for that in your timeline.

The fee

The VA funding fee on an assumption is 0.5 percent.

Do you have to be a veteran?

No. You do not have to be a veteran to assume a VA loan.

But it matters for the seller. If a non-veteran takes over the loan, the seller's VA entitlement stays tied to it until it is paid off.

If the buyer is a veteran, they can put in their own entitlement. That frees up the seller's.

Covering the gap

The sale price is often more than what is left on the loan. The buyer has to cover that gap.

You can do that with cash, or with a second loan.