HRS §209-31
When loan security is required and can be waived
This section says a loan does not need security if none is available. But if the loan buys property other than personal property or inventory, the borrower must give a mortgage or pledge on that property. The tourism director can allow another lender's lien to come first if needed.
borrowersfinancial institutions
The statute, as written — Security for loans
Security for any loan when not available is not required, however, whenever property other than personal property and inventory, is purchased with the loan funds, a mortgage or pledge of such property shall be required as security for the loan. The director of business, economic development, and tourism may, in the director's discretion, permit the mortgage or pledge to be subordinated to the lien of a financial institution or government lending agency in the event the subordination should become necessary for the borrower to secure additional funds.
LawTrove is not legal advice. The summary above is a computer-generated restatement — the authoritative text is the official version linked above.