A local nonprofit organization comprising mostly churches is calling on state leaders to do more to address the wave of home foreclosures washing through Hawaii.

Faith Action for Community Equity Hawaii, or FACE Hawaii, released a report that advocates changing the local foreclosure process, including a right to court-supervised mediation for borrowers.

In the report, FACE encourages local banks to engage in more housing counseling outreach. However, nearly all — 97.5 percent — of Hawaii foreclosure notices published in November were from out-of-state lenders, FACE said.

The group said too many families are engaged in an endless struggle with inaccessible mainland lenders.

Melba Amaral, a Kalihi Valley homeowner, said she has been trying to work out a delinquency with Bank of America for more than a year with little more than frustration to show for it.

"We’re at the mercy of the lender," she said.

Amaral said BofA rejected her for a loan modification because the bank said she failed to send in necessary documents. Amaral said she sent everything the bank requested but that the bank refuses to revisit the issue. So she retained a lawyer to help her keep her house. "I’m fighting tooth and nail for this," she said.

The FACE report, titled "Facing Hawaii’s Foreclosure Crisis," said other states are strengthening their laws and requirements regarding foreclosures, and that Hawaii needs to follow suit. "Some cities have called for moratoriums on all foreclosures, others have enacted new and creative laws to give families more rights in the foreclosure process," the report said.

Hawaii foreclosures averaged 1,236 per month this year through October, according to research firm RealtyTrac. The rate of Hawaii foreclosures has worsened this year, and on average has ranked the state as the 12th-worst nationally.

Alan Mark, FACE Hawaii president and senior pastor at Kilohana Methodist Church, wrote in the report that the organization’s 51 members, which also include labor unions and social service groups, partnered with Hawaiian Community Assets this year to distribute foreclosure- prevention materials to families but concluded that the effort was not enough.

Besides mediation, the report recommends that lenders provide delinquent borrowers with a list of legal rights and free housing counseling.

The report also recommends that state consumer protection and taxation agencies require lenders to provide them more information regarding mortgage defaults, and that lenders make more loan information public.

Recommendations are due out later this month from a 17-member foreclosure task force formed this year by the Legislature.

The task force, which represents a diverse set of interests including lender associations and consumer advocacy groups, is required to make recommendations to the Legislature before the 2011 and 2012 sessions start.

Stephen Levins, task force chairman and director of the Office of Consumer Protection under the state Department of Commerce and Consumer Affairs, said one of the key ideas the task force focused on is letting transfer foreclosure cases into court. The vast majority of foreclosure cases in Hawaii are conducted outside court under a law dating to 1874.

Levins also said the task force will be taking a close look at mediation.