Foreclosures in Hawaii have plummeted 53 percent since the Legislature passed sweeping mortgage legislation last year, officials said Thursday.
Hawaii had the nation's 11th highest foreclosure rate in 2010, prompting lawmakers to establish a Mortgage Foreclosure Task Force to look into all aspects of judicial and nonjudicial foreclosures in the state.
The task force's 2011 findings helped shape legislation that provides extensive protections to residents in danger of losing their homes due to unfair or deceptive practices.
According to a recent RealtyTrac report cited by task force member Jeff Gilbreath, the law has already made an impact.
"(The report) showed a 53 percent decrease in foreclosures in the state of Hawaii that I think we can attribute to Act 48," he said, speaking Thursday at an informational briefing before the House and Senate consumer protection committees.
The task force's mandate for 2012 was to conduct further analysis of foreclosure rules and regulations and recommend refinements to make the law clear and equitable to all stakeholders in the foreclosure process.
Panel Chairman Everett Kaneshige, deputy director of the state Department of Commerce and Consumer Affairs, said task force members broke into workgroups to go through Act 48 "line by line," focusing on issues relevant to specific groups and addressing foreclosure issues unique to condominium and homeowner associations.
Lawmakers, who will consider the task force's recommendations as they take up mortgage foreclosure legislation this session, continue to raise concerns about protecting homeowners at risk of foreclosure.
Sen. Rosalyn Baker, who said she will introduce related legislation this session, asked whether more could be done to stop some of the fraudulent, high-profile advertising that preys on those so desperate to save their homes they're willing to take imprudent risks. She suggested more could be done to prosecute those engaging in deceptive practices to "really shine a light on these folks."
"They're preying on the kupuna (elderly) and other people in the Hawaiian community," said Baker, D-Honokohau-Makena.
To put a human dimension on the issue, Sen. Brickwood Galuteria asked Gilbreath, who represents the mortgage counseling organization Hawaiian Community Assets, about the counseling process: "Can you give a sense of what it's like for the families, the diminished quality of life that happens when you might be losing your home?" asked Galuteria, D-Downtown-Waikiki.
Gilbreath said he couldn't quantify the how many people are currently seeking counseling services, but noted, "It's definitely down."
The task force's 288-page report includes proposed legislation that would make any foreclosure violations subject to enhanced penalties, specify what deceptive practices and acts can void a foreclosure, and set a six-month timeline to take action to prevent a foreclosure sale.
The task force also recommended using education to help prevent borrowers from falling victim to unethical lenders. The report recommends a position or office at the state level that would act as a clearinghouse of financial education programs and services across the state of Hawaii.
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