Welcome to DebtConsolidationCare’s Hawaii debt relief resource. If you’re managing credit card balances, payday loans, medical expenses, student loan debt or other unsecured debts, you have options—whether you live on Oʻahu, Maui, Kauai or the Big Island. Our goal is to help you understand all available pathways from nonprofit credit counseling and debt management plans to consolidation loans and settlement programs so you can choose the approach that fits your needs.
Begin with a no-cost assessment of your debt, income and monthly expenses. We’ll explain how nonprofit counseling agencies can negotiate with creditors through a Debt Management Plan (DMP) at little or no fee and how debt settlement or consolidation loans may reduce your overall interest or principal.
If you opt to work with DebtConsolidationCare, you pay only after you see an actual reduction in your balance—never before—ensuring alignment with federal Telemarketing Sales Rule requirements and Hawaii statutes on debt relief.
With more than 20 years of experience, our team provides:
- Personalized guidance from a dedicated account specialist.
- Transparent program details including estimated timelines and potential risks.
- Ongoing support as you work toward becoming debt-free, alongside referrals to local resources such as free credit counseling, workforce development programs and consumer protection agencies.
Learn more about which debt relief option makes sense for you—and take the first step toward financial stability today.
How Our Debt Relief Programs Work
Our flagship debt relief program is designed to help Hawaii residents avoid bankruptcy by negotiating with creditors on their behalf. While individual results vary, most clients achieve a 40–60% reduction in the total amount owed. Here’s how the process unfolds:
What to Expect
Personalized Assessment and Plan
We begin with a comprehensive review of your income, living expenses, credit score and all unsecured debts. Based on this analysis, we develop an affordable monthly payment schedule tailored to your financial goals and obligations.
Secure Escrow Account
Your monthly payments are held in an FDIC-insured escrow account. Funds are released to creditors only after you approve each negotiated settlement, ensuring full transparency and control.
Expert Negotiations
Our experienced negotiators leverage long-standing relationships with creditors and collection agencies to obtain the best possible terms under Hawaii’s debt collection laws. This may include lower balances, waived fees or reduced interest rates.
Streamlined Timeline
Most clients complete the program within 24 to 48 months. As each settlement is finalized, escrow funds are disbursed—either in monthly increments or as a lump sum—to eliminate individual debts.
Full Compliance and Advocacy
We handle all proposal drafting, documentation and legal compliance with the federal Fair Debt Collection Practices Act (FDCPA). You will never have to negotiate directly with debt collectors.
Ongoing Support and Plan Adjustments
A dedicated account specialist monitors your progress, answers questions and adjusts your payment plan as needed to keep you on track toward debt freedom.
Other Debt Relief Options in Hawaii
While our flagship program may be right for many, Hawaii residents can choose from several alternative solutions to get out of debt. Each option carries its own benefits, requirements and potential impacts on credit.
- Credit Counseling & Debt Management
- Debt Consolidation
- Debt Consolidation Loans
- Bankruptcy (Chapter 7 & Chapter 13)
Each of these options has potential drawbacks—such as credit impacts, fees or tax consequences—so it is important to weigh them carefully. A free consultation can help you choose the most appropriate path to lasting financial relief.
Average Household Debts in Hawaii
Understanding local debt levels can help you gauge how your financial situation compares with peers and identify areas to address in your budget. The table below summarizes the latest available averages for common unsecured debts and illustrates total estimated household debt in four major Hawaiian communities.
City-specific figures are drawn from reputable sources, while statewide averages fill gaps where localized data are not published.
| City | Avg. Credit Card Debt | Avg. Personal Loan | Avg. Medical Debt | Avg. Payday Loan Debt | Avg. Auto Loan Balance | Estimated Total Household Debt |
|---|---|---|---|---|---|---|
| Honolulu | $12,429 | $16,495 | $2,040 | $500 | $23,915 | $55,379 |
| Pearl City | $15,709 | $16,495 | $2,040 | $500 | $23,915 | $58,659 |
| Kahului | $6,673 | $16,495 | $2,040 | $500 | $23,915 | $49,623 |
| Hilo | $6,673 | $16,495 | $2,040 | $500 | $23,915 | $49,623 |
By comparing these figures, you can see that Honolulu and Pearl City households carry higher overall debt burdens, driven largely by credit card debts and auto loan balances. Kahului and Hilo reflect the statewide average credit card debt but still face significant total obligations.
Hawaii Debt and Financial Assistance Resources
Restructuring debt is only part of the solution. Building healthier financial habits and leveraging community supports can accelerate your progress. Below are five key programs and services available to Hawaii residents.
Workforce Development Division (WDD)
Increase your earning potential and reduce reliance on credit by accessing free job placement and training services. WDD connects residents with employers statewide, enhancing their ability to meet living expenses without resorting to high-interest loans.
Med-QUEST (Managed Care & Medicaid Services)
Alleviate medical debt by enrolling in state- and federally funded healthcare programs. Med-QUEST offers medical, mental health and dental coverage for eligible residents, reducing out-of-pocket expenses that often lead to unsecured debt.
Institute for Human Services (IHS)
Prevent or address housing instability with comprehensive shelter, rehabilitation and case-management services. IHS support can stabilize your living situation, allowing you to focus on debt-management strategies rather than emergency expenses.
Supplemental Nutrition Assistance Program (SNAP)
Free up household cash flow by applying for monthly food benefits. SNAP provides an electronic benefits transfer (EBT) card for groceries, easing budget pressure so you can allocate more toward paying down debts.
Hawaii Financial Assistance Program
Operated by the Department of Human Services, this program offers cash assistance, job-preparation services and supportive resources for families with children. Combining these benefits with a structured debt-repayment plan can help you regain financial stability more quickly.
By integrating these resources with a tailored debt relief or consolidation plan, you can reduce both your monthly obligations and your overall debt load—paving the way to long-term financial well-being.
Hawaii Consumer Protection Laws and Regulations
Hawaii law provides multiple layers of protection to ensure that consumers faced with debt collection or other financial services are treated fairly, transparently and without abusive practices. Key federal and state statutes apply whether you’re negotiating a settlement, disputing charges on an HSFCU credit card or responding to a Hawaii collection agency.
1. Fair Debt Collection Practices Act (FDCPA)
The FDCPA is a federal statute that governs the conduct of third-party debt collectors. Under the FDCPA, debt collectors:
- May contact only the debtor (and, in limited circumstances, their spouse) and must cease communication upon written request.
- They are prohibited from using threats of violence, obscene language or harassing calling practices (e.g., more than one call per day or at unusual hours).
- Must provide a written “validation notice” within five days of initial contact, detailing the amount owed and the right to dispute the debt.
- Cannot misrepresent the amount, status or legal consequences of a debt or falsely imply affiliation with government agencies.
2. Consumer Financial Protection Bureau (CFPB)
The CFPB enforces federal consumer financial laws and supervises large banks, credit unions and nonbank financial institutions (including debt collectors).
Its key functions for debt-related complaints include:
- Receiving and investigating consumer complaints about loans, credit cards and debt relief services.
- Issuing regulations—such as the Debt Collection Rule clarifying FDCPA requirements—to prevent unfair, deceptive or abusive practices.
- Partnering with state agencies to coordinate enforcement actions and returning restitution to harmed consumers.
3. Hawaii Revised Statutes Chapter 443B (Collection Agencies)
Chapter 443B requires any company that collects debts for compensation—or appears to be a third-party collector—to register with the Department of Commerce and Consumer Affairs. Among its consumer safeguards:
- Mandatory licensing and biennial renewal for collection agencies; exemptions for in-house collection, attorneys and certain out-of-state agencies.
- Prohibitions on deceptive forms and communications including publishing “stop lists” only at point-of-sale and forbidding public shaming of debtors.
- Bans on threats, coercion, harassment and fraudulent or misleading representations in all debt collection activities.
- Civil penalties, bond forfeiture and license revocation for violations, with consumers able to file private lawsuits for damages under HRS § 480-13(b).
4. Statute of Limitations on Debt in Hawaii
The statute of limitations (SOL) sets deadlines for creditors to sue in court. After the SOL expires, debts become “time-barred” but collectors may still request payment (without litigation).
| Debt Type | SOL (Years) |
|---|---|
| Written Contracts | 6 years (HRS § 657-1) |
| Oral Agreements/On Account | 6 years (HRS § 657-1) |
| Auto Loans | 4 years (for actions relating to personal property torts including auto loans) |
| Judgments | 10 years (court of record); 6 years (courts not of record) |
| State Tax Debt | 15 years |
Once the applicable period has passed, creditors cannot obtain a court judgment but may continue non-judicial collection efforts.
5. Hawaii Deceptive Trade Practices Act (DTPA)
Under Chapter 481A of the Hawaii Revised Statutes (and reinforced by HRS § 708-871 in the Penal Code), businesses—including debt-relief marketers—must not:
- Advertise goods or services with the intent not to sell them as advertised, misrepresent price reductions or falsely claim endorsements.
- Use bait-and-switch tactics, deceptive geographic designations or false statements about product quality, benefits or sponsorship.
- Engage in any other unfair or deceptive acts that create consumer confusion.
Victims of deceptive trade practices may seek injunctions and damages without proving competition or intent to deceive and can file complaints with the Hawaii Office of Consumer Protection.
By understanding these federal and state protections, Hawaii consumers can assert their rights when dealing with debt collectors or evaluating debt-relief offers—ensuring any resolution is conducted legally, ethically and transparently.
Bankruptcy Options for Hawaii Residents
When unsecured debts become unmanageable, bankruptcy can offer a structured legal path to relief. In Hawaii, the two primary consumer chapters are Chapter 7 (liquidation) and Chapter 13 (reorganization). Each has distinct qualification criteria, timelines and impacts on assets and credit.
Chapter 7 Bankruptcy
Discharges most unsecured debts—credit cards, medical bills, payday loans, judgments—by liquidating non-exempt assets.
Who Qualifies:
- Passes the federal “means test”—annual household income at or below Hawaii’s median for your household size1.
- Typically suited for filers with low disposable income and limited assets.
Process:
- Credit Counseling: Complete a court-approved session that reviews alternatives like debt consolidation or consumer proposals.
- File Petition: Submit official bankruptcy forms detailing assets, debts, income and expenses.
- Trustee Review: A court-appointed trustee evaluates non-exempt property for liquidation.
- Discharge: Most qualifying debts are wiped out in about 4–6 months under an automatic stay.
Chapter 13 Bankruptcy
Creates a 3–5-year repayment plan funded by future income, allowing debtors to retain property (home, car) while paying down debts at court-approved reduced terms.
Who Qualifies:
- Steady disposable income sufficient for a monthly plan.
- Unsecured and secured debt must fall below federal limits.
Process:
- Plan Proposal: Drafted with an attorney, outlining how debts are repaid over 36–60 months.
- Court Approval: Judge confirms feasibility and fairness to creditors.
- Plan Payments: Monthly remittances to the Chapter 13 trustee.
- Completion & Discharge: Remaining unsecured balances are discharged after full plan performance.
2025 Hawaii Median Income Limits for Means Test1
| Household Size | Annual Median Income |
|---|---|
| 1 person | $82,196 |
| 2 person | $96,845 |
| 3 person | $117,068 |
| 4 person | $137,454 |
| 5 person | $148,554 (add $11,100 per additional member) |
Filing Fees
| Bankruptcy Chapter | Total Fee | Payment Notes |
|---|---|---|
| Chapter 7 | $338 | May be paid in up to four installments; fee waiver available if income < 150% of poverty level. |
| Chapter 13 | $313 | Payable within 14 days of filing; no fee waiver. |
Data courtesy - https://www.hib.uscourts.gov/filing-fees
Exemptions: Protecting Your Property
Hawaii filers may choose either state-law exemptions or federal bankruptcy exemptions. Whichever set you select applies to all property in your case.
State-Law Exemptions (HRS Chapter 651, Chapter 667)
- Homestead: $30,000 equity (head of household or 65+ on up to one acre); otherwise $20,000.
- Motor Vehicle: Up to $2,575 equity in one car.
- Personal Property: Unlimited for household goods; jewelry protected up to $1,000.
- Wages: 30× federal minimum wage exempt.
- Insurance & Benefits: Full exemption for health/life insurance proceeds, pensions and public benefits.
Federal Exemptions (11 U.S.C. § 522(d))(Updated 2025):
| Exemption Type | Coverage | Amount |
|---|---|---|
| Homestead | Primary residence equity | $31,575 |
| Motor Vehicle | One vehicle equity | $5,025 |
| Household Goods | Furniture, appliances, clothing, etc. | $16,850 total (max $800/item) |
| Jewelry | Personal jewelry | $2,125 |
| Tools of the Trade | Work-related tools | $3,175 |
| Health Aids | Prescribed medical devices | Fully protected |
Alternatives & Special Considerations
Before choosing bankruptcy, consider these options:
- Debt Consolidation Loan: Merge debts into one fixed-rate loan.
- Credit Counseling & Debt Management Plans: Nonprofit agencies negotiate lower rates in exchange for a single monthly payment.
- Settlement Programs: Negotiate lump-sum settlements for a portion of unsecured balances.
Special Hawaii-specific notes:
- Payday Loans: Honolulu payday loans often carry interest rates exceeding 100%; seek nonprofit counseling and opt for payday loan consolidation before defaulting.
- Local Resources: HUD-approved credit counselors and legal aid organizations in Honolulu can advise on whether to file bankruptcy or pursue alternatives.
- Post-Bankruptcy Rebuild: After discharge, responsibly use secured credit cards or small personal loans (e.g., Hawaii State FCU programs) to reestablish credit.
Pros & Cons of Hawaii Debt Relief Options
| Option | Pros | Cons |
|---|---|---|
| Credit Counseling & DMP | Lower interest rates, single payment, nonprofit | No principal reduction; monthly payments remain fixed |
| Debt Consolidation Loan | Predictable payments, potential APR reduction | Requires fair credit; risk of collateral loss |
| Debt Settlement Program | Potential 40–60% debt reduction; halts collection calls | Credit score impact, taxable on forgiven debt, fees post-settlement |
| Chapter 7 Bankruptcy | Fast discharge (4–6 months); automatic stay halts collections | Significant credit impact (up to 10 years); asset loss risk; means test requirement |
| Chapter 13 Bankruptcy | Retains assets; stops foreclosure/repossession; structured plan | Court supervision; plan lasts 3–5 years; remains on credit report for 7 years |
Choosing the right debt relief path depends on your income, assets, credit profile and long-term goals. A free, zero-obligation consultation with a HUD-approved counselor or bankruptcy attorney can help determine the most appropriate option for your situation.
Hawaii Debt Relief FAQs
Yes. Accredited nonprofit credit counseling agencies are HUD-approved and provide free, unbiased guidance on managing unsecured debts. Licensed debt relief companies must comply with federal Telemarketing Sales Rule requirements and Hawaii statutes, ensuring transparent, compliant services.
No. Hawaii does not operate a state-run debt relief program. However, residents can access accredited private options including nonprofit credit counseling, debt management plans, consolidation loans and settlement services offered by licensed providers.
Consolidation limits vary by lender, credit score, income and debt-to-income ratio. Many banks and credit unions require minimum balances of $5,000–$10,000 and offer unsecured personal loans up to $50,000 or more, depending on your eligibility. Contact lenders directly for specific program limits and rates.
Applying for a consolidation loan or a balance-transfer card may trigger a hard credit inquiry, causing a small, temporary score dip. However, if you make timely payments on the new consolidated loan or card, your credit score can improve over time as you reduce revolving balances and demonstrate consistent repayment.
Yes. Participation in a DMP is voluntary for creditors, who may decline proposals that offer them less favorable repayment terms than pursuing other collection methods. If one creditor refuses, agencies often negotiate revised terms or advise alternative solutions.
Nonprofit credit counseling agencies typically charge a modest monthly fee—averaging around $24—and a one-time setup fee of about $33. Fees are often capped (e.g., $59 monthly, $75 setup) and may be waived for low-income clients. These fees cover the administrative costs of negotiating reduced interest rates and consolidating payments.
Chapter 7: Must pass the means test by showing household income at or below Hawaii’s median for your household size (or, if above median, having insufficient disposable income after allowable expenses).
Chapter 13: Requires steady income adequate to fund a 3–5-year repayment plan and total debts below federal caps.
Hawaii’s state homestead exemption protects up to $31,575 of home equity (up to $63,150 for married filers) in Chapter 7 cases. Equity exceeding these limits may be used by the bankruptcy trustee to pay creditors.
Filing bankruptcy provides an automatic stay, halting collection calls, wage garnishments and lawsuits and offers a clear legal path to discharge eligible debts. Allowing debts to enter collections can lead to persistent harassment, lawsuits and long-term credit damage without discharging the debt.
Yes. In addition to bankruptcy, consider nonprofit credit counseling & DMPs, debt consolidation loans or debt settlement programs. Each has distinct impacts on credit, costs and timelines.
Legal Disclaimer
This page is for educational purposes only and does not constitute legal or financial advice. Always consult a qualified attorney, HUD-approved counselor or financial advisor before making decisions about debt relief. DebtConsolidationCare.com may refer you to affiliated partners for specialized services.
About The Author
Loretta Kilday is an accomplished litigator and transactional attorney with over 30 years of experience in various fields, including debt collection and bankruptcy. Debt Consolidation Care is pleased to have her as the public voice of this organization. Her exceptional performance and dedication to her profession have enabled her to handle and resolve many cases, earning her a stellar reputation among her peers. Also, she has utilized her years of experience in training, mentoring, and leading junior attorneys and other associates, thus laying the foundation for a brighter future of legal practices.