Hawaii Runs Two Title Systems. The Exam Tests Both.

Hawaii is the only state running two parallel title systems simultaneously, and the DCCA tests which recording method applies with every title question.

The DCCA governs real estate licensing in Hawaii. The PSI exam is 80 questions, all state specific with no national component, and a 70% minimum to pass. That structure is unusual on its own, but it signals something important: Hawaii built an exam around Hawaii law entirely, and there's no national buffer to fall back on. Land Court title registration, Ohana dwelling rules that shift by county, and the double-layered HARPTA and FIRPTA withholding calculation are the three areas that account for the most missed questions on the state portion. Let me break this down so you're not one of the candidates who discovers these surprises during the exam itself.

Land Court (Torrens) vs. Regular

Hawaii's Land Court system dates to the monarchy era and carries a legal guarantee of title that the Regular System does not. That difference is precisely what the PSI exam tests, and it's a distinction no national prep course prepares you for. I know, I know: another dual-system framework. But this one actually matters on the exam, because the legal effect of each system is fundamentally different.

Hawaii is the only state running two parallel title systems, the government-guaranteed Land Court (Torrens) system from the monarchy era and the race-notice Regular System at the Bureau of Conveyances, exam questions test whether you know which recording method applies and what "conclusive proof of ownership" actually means.

The Land Court certificate functions as conclusive proof of ownership. Once registered, a third party can't claim a superior interest based on an unrecorded prior conveyance. Know when Land Court registration applies, what the registration process requires, and how the legal effect of a Land Court certificate differs from a recorded deed under the Regular System.

Hawaii's dual title registration system has no direct equivalent on the California or Washington exams. California covers title insurance requirements without a Torrens option, and Washington uses only the recording system, making Hawaii's Land Court the most unusual title registration setup tested on any state exam.

Ohana Dwelling Rules

Ohana dwelling rules are county-level regulations, not statewide law. The correct answer on the PSI exam depends entirely on which island the property is located on, a level of local specificity no national course ever addresses.

"Ohana" sounds simple until the exam asks whether a second kitchen needs a county building permit, what lot size is required, or why you cannot condominiumize an Ohana unit on Oahu, rules that change by county and trip up candidates who assume one island's laws apply statewide.

The PSI exam will ask whether a specific Ohana configuration is permissible, whether condominiumization is allowed, and what the lot size and setback requirements are for a given county. Treating Ohana rules as uniform across the state produces wrong answers on every scenario where the island location determines which county code controls.

Know which counties permit Ohana units by right, which restrict them to owner-occupants, and why Oahu's prohibition on condominiumizing Ohana units is a hard rule, not a zoning preference that can be waived with the right permit application.

HARPTA/FIRPTA Math

HARPTA adds a state-level withholding layer on top of FIRPTA that applies to non-Hawaii-resident sellers, not just foreign nationals, and the PSI exam will ask you to calculate both from the same sale price without confusing who each withholding applies to.

Candidates must calculate both the 7.25% state HARPTA withholding on non-Hawaii-resident sellers AND the 15% federal FIRPTA withholding on foreign sellers from the same sales price, double-layered math that accounts for some of the highest exam error rates on the state portion.

The exam distinguishes between a seller who is a U.S. citizen but not a Hawaii resident (subject to HARPTA but not FIRPTA) and a foreign national seller subject to both. Know which withholding applies to which seller category, calculate each percentage from the gross sales price, and understand what exemptions can reduce or eliminate the obligation. These are separate calculations applied to potentially overlapping groups of sellers, and the PSI exam tests whether you can keep the two systems straight under scenario conditions. Why did the Hawaii closing agent bring two calculators to the table? One for HARPTA, one for FIRPTA. (You're welcome.)