Act 48: Hawaii Relief has arrived in the form of our new foreclosure law just enacted. This gives real power back to the people and makes lenders meet face to face with the borrower prior to foreclosure.

Many of our short sale clients have complained (and rightfully so) that they felt disenfranchised from the process of negotiating with their lender for a loan modification. In some instances they were told by their lender unless they were late in payments they wouldn’t get modified. So late payments equaled bad credit and the banks still didn’t modify their loan, and many times claimed paperwork was “missing” or not turned in. These were the same excuses from lenders that we have seen for years working with short sales.

Overseen by the Department of Commerce & Consumer Affairs, Office of Administrative Hearings, with assistance from Judiciary this new law will require lenders to file with the Department prior to foreclosure process beginning. The Dept will then notify all parties and if an owner occupant (having lived in home for 200+ consecutive days) wishes to mediate then both parties are given date/time to meet. There are minor fees involved required from both parties.

If the Mortgagee is pursing a non-judicial foreclosure both parties are required to participate. The program is slated to begin on or before Oct 1, 2011 and not end until Sept 30, 2014.

Certain requirements from the owner are required including list of items to bring to the negotiating table.

To read more on Act 48 click here.