You are probably excited to find the right Oahu home, but the real work happens in escrow and at closing. If you are unsure what fees you will pay, who does what, or how Hawaii’s process works, you are not alone. This guide gives you a clear breakdown of escrow on Oahu, what closing costs to expect, local issues that affect timing and budget, and practical ways to keep costs in check. Let’s dive in.
Escrow on Oahu
Escrow is the neutral process that protects you and the seller while the contract conditions are completed. A title or escrow company holds funds and key documents, then records the deed when everything is ready. You get a structured path from accepted offer to keys.
Who is involved
- You and the seller agree to terms in the contract.
- The escrow officer/title company holds earnest money, runs the title search, prepares the settlement statement, and handles recording.
- Your lender, if you finance, orders the appraisal and sets loan conditions.
- Your real estate agent coordinates inspections, contingencies, and document delivery.
- Inspectors, surveyors, and HOA managers support due diligence as needed.
Step-by-step flow
- Open escrow and deposit earnest money.
- Complete inspections and loan application. Review title and seller disclosures.
- Resolve any repairs or credits and clear contingencies.
- Confirm title commitment and decide on owner’s title insurance.
- Review your final settlement statement and Closing Disclosure.
- Fund your loan or wire cash to close, then record the deed and receive keys.
Typical timing on Oahu
Most financed purchases close in about 30 to 45 days from contract acceptance. Cash deals can close faster. Condo document delivery, title issues, HOA approvals, or complex conditions can extend the timeline.
Your closing costs
Buyer closing costs generally run about 2% to 5% of the purchase price, not including your down payment. The exact amount depends on your loan program, property type, and how you negotiate with the seller.
Loan-related fees
If you use a mortgage, expect items like an origination or application fee, underwriting and processing fees, an appraisal fee, and a credit report charge. Mortgage insurance may apply depending on the loan and down payment.
Title and escrow fees
You will see fees for the title search and title commitment. Your lender usually requires a lender’s title insurance policy. An owner’s title insurance policy is optional but often recommended to protect your equity. The escrow or closing fee is common and can be split between parties by custom or negotiation.
Government and recording
Plan for county recording fees for the deed and mortgage. Hawaii has a state conveyance tax on real property transfers. Whether the buyer or seller pays this tax is a matter of custom or negotiation, so confirm responsibility in your contract.
Prepaids and reserves
You may prepay a portion of homeowner’s insurance and set up escrow reserves for property taxes and insurance. Expect prorations for property taxes and any HOA or condo dues.
Inspections and extras
Budget for a home inspection and, where applicable, a pest or termite inspection. Some properties may require specialized inspections, such as wastewater or sewerability-related checks. You may also see survey costs, flood certification, wire or courier fees, and initial impound deposits.
Who usually pays what
Sellers often pay real estate commissions and sometimes the conveyance tax, though this can vary by deal. Buyers typically pay lender fees, appraisal, inspections, recording related to the mortgage, impound setup, and prorations for taxes and HOA dues. Remember, these allocations are negotiable. Confirm responsibilities in your purchase contract and with your escrow officer.
Oahu specifics to expect
Local practices and property types can influence timeline and costs. A few Oahu details are worth flagging early.
Conveyance tax and recording
Hawaii imposes a state conveyance tax on real estate transfers. Current rates and any exemptions are set at the state level. In Honolulu County, you should also expect recording fees for the deed and mortgage. Property taxes are prorated at closing according to the county’s billing cycle. Verify the latest figures with your title or escrow officer.
Condos and HOAs
Condo purchases often require association documents, estoppel statements, and transfer or processing fees. These items can take time to obtain and review. Build in extra room for document requests and any board or management reviews so escrow can clear requirements without delaying closing.
Environmental and utilities
Some properties use cesspools or require connection to sewer systems. Policies and timelines for upgrades can affect inspections, timing, and negotiations. Homes near the shoreline may carry additional disclosures or title encumbrances related to setbacks and coastal rules. In rural or agricultural areas, confirm water availability, access rights, or catchment systems with proper inspections and documents.
Local title considerations
Easements, older chain-of-title issues, or unique encumbrances can appear in island properties. A thorough title search and early coordination with a local title company help avoid last-minute surprises.
Your 30 to 45 day plan
Here is a practical timeline to keep your purchase on track.
Before you write an offer
- Get preapproved and confirm your cash to close.
- Discuss a realistic closing date and contingency periods with your agent.
- Assemble ID, income and asset documents, and proof of funds for the earnest money.
After acceptance: early steps
- Day 0 to 3: Open escrow and deposit earnest money. Apply for your loan if financing.
- Days 3 to 10: Order inspections. Your lender orders the appraisal.
- Days 10 to 21: Resolve inspection issues and finalize any repair credits. Your lender processes underwriting and may request additional documents.
- Title search completes and a preliminary report is issued. Decide whether to purchase an owner’s title insurance policy.
Final week and closing day
- At least 3 business days before closing: If you have a loan, you must receive a Closing Disclosure. Review the interest rate, fees, and total cash to close.
- Within 24 to 48 hours before closing: Do a final walk-through.
- Closing day: Sign documents and wire funds or bring a bank check as instructed by escrow. After lender funding and county recording, you receive keys.
Ways to reduce costs
You have several levers to manage your cash to close without sacrificing protection.
Smart negotiations
Ask the seller for concessions to cover specific buyer closing costs, such as lender fees, a portion of the escrow fee, or HOA transfer fees. Tie any credits to clear line items in your settlement statement so everyone knows what is covered.
Compare and plan
Shop lenders early and compare their Loan Estimates. Fees vary. You can also compare title and escrow company fees. Some lenders allow rolling certain costs into the loan or offsetting them with a small rate change. Weigh the long-term cost against near-term savings.
Safety first
Always confirm wiring instructions directly with your escrow officer by phone before you send funds. Wire fraud targeting real estate closings is common. Protect your information and never rely solely on email for wire details.
Insurance choices
An owner’s title insurance policy is a one-time cost that protects your equity for as long as you own the property. Consider your hold period and risk tolerance when deciding.
What to bring and prepare
- Government-issued photo ID and Social Security number.
- Proof of homeowner’s insurance binder.
- Verified funds for down payment and closing costs.
- Employment and asset documents your lender requests.
- Any HOA applications or approvals required for your building or neighborhood.
Verify current figures
Updated December 2025. Fees and tax rates change over time. Confirm current conveyance tax rules with the state. Check recording fees and property tax billing with the City and County of Honolulu. Review federal mortgage disclosure timing with your lender. Your title or escrow officer can provide the most accurate settlement figures for your specific property and contract.
Ready for a smooth closing
Buying on Oahu should feel clear and confident from offer to keys. With the right plan, you can anticipate costs, navigate condo or environmental items, and close on time. If you want a concierge-level experience and meticulous guidance through escrow and closing, connect with Luxum Group Brokered by eXp Realty for discreet, expert representation.
FAQs
How much should I budget for closing costs on Oahu?
- Plan for about 2% to 5% of the purchase price for buyer closing costs, not including your down payment.
Who pays Hawaii’s conveyance tax in a purchase?
- Responsibility is set by custom or negotiation. Confirm the payer in your contract and verify details with your escrow officer.
Is owner’s title insurance required in Honolulu County?
- Lenders typically require a lender’s policy. An owner’s policy is optional but recommended to protect your equity.
How long does escrow usually take on Oahu?
- Most financed transactions take about 30 to 45 days from acceptance. Cash can be faster.
What can delay closing on an Oahu condo purchase?
- Common delays include condo document delivery, HOA approvals, title issues, inspection repairs, and loan underwriting conditions.
When will I receive my loan’s Closing Disclosure?
- You must receive the Closing Disclosure at least 3 business days before closing. Review it carefully for fees and cash to close.
