Refinancing a Reserved Housing Unit

Refinancing a Reserved Housing Unit

Owners of an HCDA Reserved Housing Unit may refinance under certain conditions with subordination approval from HCDA.  Complete the highlighted sections of the letter linked below and return to HCDA, along with the documents mentioned at the bottom of the letter.  This letter will serve as your formal request for subordination of HCDA’s shared equity interest.

On August 5, 2020, HCDA’s board allowed the increase of the maximum refinancing limit to 95 percent of the original purchase price.  Previously, refinancing requests were limited to the original loan amount, provided it was no higher than 80 percent of the purchase price.  The new board approval does not consider the original loan amount in refinance limits.

All other prior policies still apply, such as the HCDA maintaining its second lien position at all times.  The HCDA will deny all requests that would subordinate its shared equity interest to a second mortgage (i.e., Home Equity Line of Credit) or would further demote the HCDA’s second lien position on the property.

If your request meets the above limits, please draft a Subordination of Equity Sharing Payment Agreement using the applicable template linked at the bottom of this page.  Do not make any changes to non-highlighted text, as this will delay review.  Please note there is a specific required language for lenders utilizing Mortgage Electronic Registration Systems (MERS) as indicated in paragraph three of the MERS Subordination Document template.

Please allow 4-6 weeks for legal review after submitting all required documents to HCDA.

HCDA’s consent to subordinate is required prior to refinancing an existing loan, regardless of whether the regulated term has expired or not.  HCDA’s consent is not needed if the lender is willing to subordinate to the HCDA, thereby elevating the HCDA to the first lien position.

Email all documents to:

If you have any questions, call HCDA at (808) 594-0300.


Request for Subordination Template Letter Rev. Oct.2020

400 Keawe Subordination Template Rev.10.14.20

Ke Kilohana Subordination Template Rev. 10.14.20

Keauhou Place Subordination Template Rev.10.14.20

Keola Lai Subordination Template Rev.10.14.20

Pacifica Subordination Template Rev. 10.14.20

Rycroft Terrace Subordination Template Rev.10.14.20

Symphony Subordination Template Rev.10.14.20

MERS Subordination Document Template Rev.10.14.20