Hawaii Foreclosure Laws

In Hawaii, both in-court (also known as judicial) and out-of-court (also known as non-judicial) foreclosure proceedings are allowed. Unlike other states, which allow both proceedings but favor one, Hawaii tends to use both methods equally. Most non-judicial foreclosures in the state take about six months while most judicial foreclosed take about eleven months.

Non-judicial Foreclosure in Hawaii

If a mortgage or deed of trust has a sale clause that permits the lender to sell a property without going to court in the event of a default, an out-of-court foreclosure usually takes place. The clause in the mortgage or deed of trust may contain details about the procedures that the lender must follow in order to foreclose. For example, some clauses may require the lender to alert the debtor about defaults and about any intentions to start the foreclosure process.

For non-judicial foreclosures in Hawaii, the lender must file a notice of the foreclosure sale. This notice needs to include the terms of the sale, the time and place of the sale, the names of everyone involved, and a description of the home or property. The notice must be delivered to the debtor and must be posted on the property at least 21 days before the scheduled auction. In addition, the lender must make sure that the notice of sale is published in a local newspaper for three consecutive weeks before the sale, at a rate of once per week. The last publication date of the notice must be at least fourteen days before the auction date. If the sale is rescheduled, the notice of sale - with the new sale information - must be mailed, sent, posted, and published anew.

Judicial Foreclosure in Hawaii

A judicial foreclosure in Hawaii starts when the lender files documents in a court, requesting the court to find the debtor in default. The lender must then notify the debtor of the filing or must publish the notice if the debtor cannot be found. The debtor usually has twenty days to respond to the filing, and if she or she does not do this, the court can find the debtor in default. When this happens, the lender can schedule a foreclosure auction. The debtor has thirty days after being found in default to appeal the court's decision. Up to three days before the foreclosure auction, the debtor can still stop the foreclosure process by paying the debt and any additional fees.

Once the auction date is determined, a commissioner will be appointed. This person will oversee the sale of the property and will ensure that the sale of notice is correctly published. For a judicial foreclosure in Hawaii, the sale of notice must include any open house dates, and details about the location and date of the auction. This notice must be published in a local newspaper.

At the sale itself, the highest bidder must pay 10% of the bid amount in a cashier's check or cash. After this, a conformation hearing is held to allow the court to determine whether the winning bid is a fair price. If the price is found to be acceptable, the court confirms the sale and the winning bidder can pay the outstanding bid amount and assume ownership of the property.