Honolulu, Hawaii Foreclosure Attorney

    Honolulu, Hawaii Foreclosure Lawyer Nathan Natori assists Hawaii lenders with foreclosing on Hawaii real estate.  Whether through a Hawaii non-judicial foreclosure (described below) or through the preferred Hawaii judicial foreclosure, a lender’s Hawaii mortgage will be enforced.  If a Hawaii deficiency judgment is obtained against the borrower and the Hawaii guarantors, Mr. Natori will pursue enforcement of the Hawaii deficiency judgment and take other steps to obtain a cost effective strategy.

    A Hawaii judicial foreclosure normally takes 6 to 9 months, and involves numerous court filings.  Although costlier, a judicial foreclosure better protects the lender because of the court's involvement and because the lender can obtain a deficiency judgment against the borrower in case the real property sells for less than what the borrower owes.

    Besides Hawaii judicial foreclosures, the other method of foreclosing mortgages in Hawaii is foreclosure under a power of sale which possibly eliminates judicial involvement.  The Hawaii Revised Statutes enables a foreclosing mortgagee to foreclose on the mortgaged property outside of the judicial system one of two ways.  The first method to foreclose via a power of sale is under the old provisions of Hawaii Revised Statutes (“Old Statute”).  In contrast, the Hawaii Legislature passed in 1999 newer power of sale provisions (“New Statute”) that provide for an alternative method.  However, the Old Statute is the popular choice for non-judicial foreclosures because of the complexity and difficulty in complying with the requirements under the New Statute, including getting the borrower to sign the conveyance document after the public auction.  Click here to read about the problems with Hawaii's Non-judicial foreclosure pursuant to the New Statute. 

    In order to foreclose pursuant to the Old Statute, the mortgage must contain a “power of sale” language that specifically allows the mortgagee to foreclose under a power of sale.  When the power of sale is contained in the mortgage, and where the foreclosing mortgagee desires to foreclose under the power of sale upon breach of a condition of a mortgage, the mortgagee is required to be represented by a Hawaii attorney under the Old Statute.

    First, a demand letter is sent to the borrower to provide notice that the mortgagee will initiate judicial foreclosure if the loan is not brought current.  If the borrower fails to cure the default, then the Hawaii attorney must provide any notices or do any acts as are authorized or required by the power of sale contained in the mortgage.  

    Provided that all prior requirements under the Hawaii Revised Statutes have been complied with, the foreclosing mortgagee can proceed with a public sale of the mortgaged property pursuant to the Old Statute.  The mortgagee within thirty (30) days after selling the property in pursuance of the power of sale is required to file a copy on the notice of sale and the mortgagee’s affidavit, setting forth the mortgagee’s acts in the premises fully and particularly, in the State of Hawaii Bureau of Conveyances.

    Although the Old Statute does not specifically prohibit a mortgagee from obtaining a deficiency judgment in the event the sale proceeds are not sufficient to cover the loan, the mortgagee probably will not be able to obtain a deficiency judgment because there is no court involvement.  As a result mortgagees pursue a judicial foreclosure so that a deficiency judgment can be obtained.

    As you can see, even if the mortgagee forecloses on the mortgaged property pursuant to the Old Statute, he/she is still required to hire a Hawaii attorney.  Therefore, please contact us if you need a Hawaii attorney in your corner.