Foreclosure Law in Hawaii

In Ewa Beach, Hawaii, foreclosure is a legal process through which an entity which has issued a mortgage takes possession and/or ownership of the property that secured the mortgage, because the individual who took out the mortgage has consistently failed to make payments on it. The property in question is usually a house.

When individuals are facing foreclosure, it usually involves a house. The bank will acquire the house with the intent of selling it at an auction, hoping to cover whatever's left on the mortgage, giving them at least a chance to break even on the loan.

In every U.S. state, including Hawaii, a borrower has a right to a judicial sale of their foreclosed property. A judicial sale is just an auction supervised by a court. The purpose of this is to make sure that the lender takes reasonable steps to sell the home for the highest possible price, and to ensure that the homeowner has an opportunity to bid on the house, if he or she is able. It is in everybody's interest for the bank to get the highest price possible for the house, even the borrower's. If the house fetches a higher price than what's left on the mortgage, the buyer can keep what's leftover. On the other hand, if it fetches less, the buyer might have to pay the deficiency.

In some states, original mortgages are regarded "non-recourse" loans. This means that once the house or other property that secured the mortgage is sold, and if it sells for less than the balance of the mortgage, the lender has to absorb the loss, and cannot sue the borrower for the remainder. This usually does not apply to second mortgages or refinanced loans.

How to Possibly Avoid Foreclosure in Ewa Beach, Hawaii

It's very important that you engage in continued communication with your bank. Lenders are surprisingly willing to make accommodations if it means they still get paid something, but in order to accommodate your case, they have to know about it.

You must keep in mind that banks are in the business of lending funds, not flipping property: the bank doesn't really want your house. To that end, they'll occasionally go to great lengths to accommodate your financial situation, whatever it may be. For banks, foreclosure is a last resort.

If you experience a sudden change in your financial situation, your lender, in an effort to keep you from defaulting, might be willing to accept lower monthly payments, at least temporarily.

As a last resort, you might consider a "short sale," which results in loss of the home, but it usually leads to a great deal of the debt on the mortgage being forgiven. Essentially, a short sale in Hawaii involves selling the house for whatever price it can fetch. The proceeds from the sale go to the lender, and if it sells for less than what's left on the mortgage, the balance of the debt is forgiven.

Can a Ewa Beach, Hawaii real estate attorney help?

In Ewa Beach, Hawaii, dealing with a possible foreclosure is never easy. However, the assistance of a reputable real estate lawyer can make the whole process much more bearable, and possibly delay or even prevent the foreclosure altogether.