THE SENATE

S.C.R. NO.

170

TWENTY-FIFTH LEGISLATURE, 2010

 

STATE OF HAWAII

 

 

 

 

 

SENATE CONCURRENT

RESOLUTION

 

 

requesting the PROVISION OF mortgage foreclosure mediation services to hawaii's homeowners and lenders.

 

 


WHEREAS, according to the national Mortgage Bankers Association, 7,535 residential property loans were in foreclosure at the end of last year in Hawaii and an additional 12,182 mortgages were delinquent but not yet in foreclosure, which amounts to nearly twelve per cent of Hawaii homes that were in foreclosure or threatened by foreclosure; and

 

WHEREAS, RealtyTrac reports that Hawaii experienced a 286.4 percent increase in foreclosures from January 2009 to January 2010 and a 241 percent increase in foreclosure auction notices, which is an early step homeowners take to save their homes from foreclosure; and

 

WHEREAS, state laws permit foreclosure through two methods foreclosure by action (judicial foreclosure) and foreclosure by power of sale (non-judicial foreclosure); and

 

WHEREAS, according to AroundHawaii.com, foreclosure by action could take about one year and cost the lender over $8,000 plus the amount of the unpaid monthly payments and legal fees, and foreclosure by power of sale usually takes about two to four months at a cost of over $3,000; and

 

WHEREAS, foreclosure by power of sale, which is shorter and less expensive than judicial foreclosure, is the predominant method of foreclosing on mortgages in Hawaii; however, it still costs a significant amount of time and money for both lenders and homeowners; and

 

WHEREAS, states such as Connecticut, New Jersey, and Ohio have established foreclosure mediation programs, which assist homeowners in avoiding foreclosure by mediating meetings between homeowners and lenders to make payment arrangements that balance the interests of both homeowners and lenders; and

 

WHEREAS, in light of the economic situation and foreclosure increases, the Legislature finds that a mortgage foreclosure mediation program similar to the programs in Connecticut, New Jersey, and Ohio would benefit Hawaii's homeowners; now, therefore,

 

BE IT RESOLVED by the Senate of the Twenty-fifth Legislature of the State of Hawaii, Regular Session of 2010, the House of Representatives concurring, that the Hawaii State Judiciary is requested to provide mortgage foreclosure mediation services for Hawaii's homeowners and their lenders; and

 

BE IT FURTHER RESOLVED that the Hawaii State Judiciary is encouraged to review and assess:

 

(1) Foreclosure mediation programs in other states;

 

(2) The feasibility and estimated costs of establishing and operating an independent foreclosure mediation program; and

 

(3) The feasibility and estimated costs of establishing a foreclosure mediation program within the existing Center for Alternative Dispute Resolution or expanding the Center's services to include foreclosure mediation,

 

to provide mortgage foreclosure mediation services in a way that is cost-effective and workable in Hawaii; and

 

BE IT FURTHER RESOLVED that the Hawaii State Judiciary is requested to report its findings and recommendations, including recommended legislation, to the Legislature no later than twenty days prior to the convening of the Regular Session of 2012; and

 

BE IT FURTHER RESOLVED that a certified copy of this


Concurrent Resolution be transmitted to the Chief Justice of the Hawaii Supreme Court.

 

 

 

 

OFFERED BY:

_____________________________

 

 

Report Title:

Mortgage Foreclosure Mediation Services; Judiciary