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Six Per Cent Interest Cap — Reaching Debts the Federal Act Does Not

A pre-service debt bearing more than six per cent may not bear more than six per cent during a period of state active duty or full-time Guard duty. "Interest" includes service charges, renewal charges and fees.

Verified August 23, 2026

What this benefit is

What it's worth: Pre-service debt capped at 6% a year during the period of service

The cap applies only to an obligation or liability incurred BEFORE entry into service. A debt taken on during service is outside it.
The statute defines "interest" to include service charges, renewal charges, fees or other charges on the obligation, except bona fide insurance — so a lender cannot hold the headline rate at six per cent and recover the difference in fees.
The cap is not absolute. On the obligee’s application, a court may lift it if in the court’s opinion the ability to pay the higher rate is not materially affected by the service.

Who is entitled to it

Chapter 657D reaches the state military forces and full-time National Guard duty.
Your home is in this state.

Not sure whether that describes you?

Answer a few questions about this benefit specifically — we only ask what this one actually depends on, and we stop as soon as we know.

How to claim it

Deadline: On entering state active duty or full-time Guard duty

1Write to the servicer naming HRS §657D-17 and enclose the order placing you on state active duty or full-time National Guard duty.
2List the account numbers and the dates the debts were incurred. Only debts that predate your entry into service are capped.
3Check the fees as well as the rate. The statute’s definition of interest sweeps in service charges, renewal charges and other fees, and that is where a reduction usually leaks away.
4If the creditor applies to court to lift the cap, the question a judge asks is whether your ability to pay the higher rate is materially affected by the service — prepare to answer it with figures.

Form: Written notice to the creditor, with a copy of the order
File with: The lender or servicer holding the obligation
Documents you will need: dd214
No renewal: Once granted it does not need renewing.

Worth knowingSix per cent is the same figure the federal Servicemembers Civil Relief Act uses, so this section adds no headroom for someone on federal orders. What it adds is REACH: it applies the same cap to state active duty, which the federal act does not cover.

Sources

authority · statuteHRS §657D-17 — Maximum rate of interest
operating · statuteHRS chapter 657D — Civil Relief for State Military Forces, chapter contents

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