A trend of fewer foreclosure cases started against Hawaii property owners continued last month, new data from the state Judiciary shows.
September was the fourth consecutive month where the number of new cases stayed near 200 after ranging from 346 to 450 during the first five months of this year.
There were 207 new cases last month. That followed 225 in August, 234 in July and 219 in June.
Fewer homeowners behind on their mortgages and more efforts by lenders to modify loans have been cited as reasons for the moderating case volume.
Hawaii’s improving economy had helped stoke reductions in other areas such as unemployment and bankruptcies that have been playing out for at least two years. But changes to Hawaii’s foreclosure law in each of the last two years had an effect of bogging down foreclosures, and in some cases forced lenders to stop and then restart the process.
Changes to the law in 2011 attempted to protect consumers from lenders rushing foreclosures through an out-of-court, or nonjudicial, process with little oversight.
One major new provision tried to let homeowners receive help from mediators, but lenders avoided that by filing all new cases in court, where foreclosure takes longer and costs more but doesn’t require mediation.
Last year, a key change to the law required that attorneys attest to the accuracy of all documents filed by lenders in court, which caused another temporary slowdown as lenders and attorneys adopted new procedures.
After the change last year, the number of new cases plunged from 458 in June 2012 to 74 the next month. Case volume, however, began rising again at the end of last year and had rebounded to 450 in March.
Observers including local foreclosure attorneys say that falling volume in recent months appears to reflect a more natural reduction in foreclosure troubles.
A report released earlier this month by financial services firm CoreLogic said serious mortgage delinquencies in Hawaii fell to 5.4 percent in August from 6.6 percent in the same month last year.
NO PLACE TO CALL HOME New Hawaii foreclosure cases filed in state court, including the year-over-year percentage change:
2013
Month |
Total |
Change |
September |
207 |
N/A |
August |
221 |
N/A |
July |
234 |
N/A |
June |
219 |
-52% |
May |
346 |
-13% |
April |
397 |
4% |
March |
450 |
11% |
February |
399 |
16% |
January |
390 |
37% |
Note: The year-over-year change for July is not meaningful because a change to state law caused a drop in case volume for several months last year starting in July.
Source: State Judiciary
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