Hawaii foreclosure lawsuit volume grew in September to its highest point this year since a tweak to state law produced an abrupt drop in May.
Preliminary statistics from the state Judiciary show that there were 188 foreclosure lawsuits filed in Circuit Court statewide in September following 131 in August, 160 in July, 122 in June and 80 in May.
September’s volume remained 9 percent below the same month last year, though the year-over-year difference was the smallest since a new requirement was imposed earlier this year on lawyers filing foreclosure cases in state court.
The new requirement specifies when attorneys must validate information from lenders used to initiate foreclosure cases against homeowners.
A 2012 amendment to state foreclosure law said attorneys must affirm in writing that they communicated with a representative of the lender pursuing foreclosure, and confirm the accuracy of allegations along with any supporting affidavits and notarizations in the lawsuit. Attorneys also must name lender representatives with whom they communicated and on what date.
The 2012 amendment, however, was silent on when such affirmations had to be filed. As a result, many attorneys were filing the affirmations near the end of the foreclosure process.
That practice raised concerns about "unwarranted" foreclosure actions, according to reports this year from the House Judiciary Committee and House Committee on Commerce and Consumer Protection. Lawmakers addressed the concern with House Bill 2513 to require that affirmations be submitted with the initial complaint in foreclosure lawsuits. Gov. Neil Abercrombie signed the bill into law as Act 37 on April 23.
Some local foreclosure attorneys have previously said that the new rule wouldn’t affect how lenders pursue foreclosure, and that the only change would be a temporary slowdown in filing cases until lenders and attorneys adjusted to the new rule.
The slowdown was dramatic in May, as the number of new foreclosure lawsuits plummeted 77 percent to 80 cases after 11 consecutive months each with around 200 new cases.
With September’s case count close to 200, the effects from Act 37 could be dissipated. It’s even possible that the September tally could rise, given that the Judiciary sometimes revises foreclosure case counts upward a month or so after preliminary data is reported.
In July, for instance, an initial count of 150 cases was later revised to 160.