The Maui News - Foreclosure Help Offered by Hirono

News Article

By Chris Hamilton

U.S. Rep. Mazie Hirono brought together about two dozen experts recently to help island residents facing the prospect of losing their homes to lenders or their life savings to scam artists.

"When you're facing foreclosure, there's a lot of frustration," Hirono said recently at the Maui Waena Intermediate School cafeteria. "And people say they feel like they have nowhere to turn. So I decided to bring all these people together under one roof."

The experts, some of whom represented banks holding residents' mortgages, nearly outnumbered the number of residents who showed up for help last month.

Nevertheless, Hirono urged residents facing foreclosure to get help as soon as possible from an agency authorized by the U.S. Department of Housing and Urban Development and to avoid paying "someone who says they can fix your problem for nothing except the fees they charge."

She warned residents that those making such promises are likely con artists ready to take homeowners' money. She also implored residents to respond to foreclosure notices quickly with the help of those on a list of experts provided on her website, hirono. house.gov.

In July, the most recent month for which information is available, Maui County had the highest foreclosure rate of one filing per 660 households based on 101 total filings. Hawaii County was second with one filing per 678 households based on 119 filings. Kauai County ranked third with one filing per 1,205 households based on 25 filings, and Oahu had the most filings, 145, but the lowest rate of one per 2,332 households.

RealtyTrac reported that Hawaii foreclosure filings fell 58 percent from July 2010 when there were 930 filings statewide to 390 foreclosures in July this year. The real estate research firm attributed the data to lenders being restrained by a new state law, Act 48, that suspended nonjudicial foreclosure proceedings. The number of foreclosure filings is expected to increase in October when a mediation program for lenders and homeowners is in place.

Much of the discussion during Hirono's meeting was focused on Act 48, Hawaii's foreclosure reform measure signed into law by Gov. Neil Abercrombie following this year's legislative session. Before the law went into effect, most mortgage lenders used nonjudicial foreclosures to seize properties from homeowners in default, without judicial oversight.

As of Oct. 1, lenders seeking nonjudicial foreclosures would need to file notices with the state Department of Commerce and Consumer Affairs' Office of Administrative Hearings and a $250 filing fee. The process will give owner-occupants of residential properties who are facing foreclosure an opportunity to meet with lenders face to face with a trained, neutral third party to modify home loans or to work out a payment plan within three months.

The program runs through September 2014.

Mortgage holders Fannie Mae and Freddie Mac have announced they intend to use only judicial foreclosures in light of the new law, effectively bypassing the mediation process, although still providing for judicial oversight.

To join the state Mortgage Foreclosure Dispute Resolution program, the homeowner facing foreclosure must respond within 30 days of receiving a certified letter from the program and pay $300 to participate, said Seth Corpuz-Lahne, a program specialist for the program.

Once homeowners join, the nonjudicial foreclosure action is suspended, he said. And the lender or mortgage holder is required by law to participate in the process.

The lender and mortgage holder "can strike a deal," he said.

Kehau Yap, Hirono's constituent services manager, said the representative would like to hold more informational meetings to provide a venue for debtors and creditors to speak informally.

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