In an effort to help out struggling Hawaii homeowners, the state’s governor, Neil Abercrombie, signed Senate Bill 651 into law last week. The bill is being hailed as “one of the strongest in the nation” and could be a model for other states. The bill overhauls the non-judicial foreclosure process in the state so that homeowners have more time and more rights to mediation, including the option to conduct foreclosure mitigation efforts directly with a lender representative in from of a “neutral, dispute-resolution professional.” Homeowners also have the option of converting a non-judicial foreclosure to judicial foreclosure if they do not want to participate in dispute resolution, and mortgage servicers with “20 percent market share in the state must maintain a local office.”
Mortgage servicers and other advocates for the lending industry have said that the new bill will make loans harder to obtain and more expensive. They even say that the bill could ultimately stifle Hawaii’s housing recovery. At least one senator publicly called that statement “baloney.”
Do you think that this is a good way to handle foreclosures in a state that has been hit hard by the real estate crisis?
Thank you for reading the Bryan Ellis Real Estate Letter.
Your comments and questions are welcomed below.