The number of foreclosure filings in Hawaii sank in April to its lowest for any month since a controversial overhaul of a state law governing residential foreclosures took effect last May, according to a report released Wednesday by real estate research firm RealtyTrac.
There were 314 filings last month. That was the fewest since 344 in June, which was the first full month under the new law that severely constrained the number of cases being filed. The filings decreased because lenders were fearful of what they viewed as unjust penalties for even the most insignificant violation of the law.
April’s count was down 68 percent from the 1,081 filings in April 2011. Since May, monthly filings have mostly ranged between 400 and 600.
It’s hard to say what may be the reason for last month’s drop or whether it may be a one-time occurrence or the beginning of a trend.
Some local attorneys predict that a new round of changes to Hawaii’s foreclosure law approved by the Legislature earlier this month will trigger another major slowing or a complete shutoff of foreclosures if the measure, House Bill 1875, becomes law. Gov. Neil Abercrombie is expected to approve the bill.
Last month, the drop was both in new cases and the number of repossessions by lenders. New cases, which have been filed exclusively in court since last May, totaled 213, which was the second-lowest number after 163 in June. There were 88 repossessions, which was the lowest since last May.
In the two years before the law’s change, lenders were typically filing 900 to 1,600 foreclosure filings a month.
The drop-off in April gave Hawaii the 36th lowest rate of foreclosures among states, at one filing for every 1,654 households.
The lowest rate was in North Dakota, which RealtyTrac said had eight foreclosure filings, or one per 39,687 households. The highest rate was in Nevada, which the firm said had 3,909 filings, or one per 300 households.
The national rate was one filing per 698 households based on 188,780 filings that represented a 14 percent decrease from April 2011.
