Fannie To Do 'End Run' Around New Hawaii F'closure Rules; Orders Dismissal Of All Non-Judicial Actions; Cases Now To Be Filed In Court; Re-Dos Needed
MortgageOrb reports:
- Fannie Mae has directed its servicers to commence all new foreclosures in the state of Hawaii as judicial
foreclosures.(1) The company has also instructed servicers to dismiss all pending Fannie Mae nonjudicial foreclosures in the state that have not proceeded to sale and convert them to judicial foreclosures. - The new policy, which is effective immediately, is the result of recent legislation that changes the state's foreclosure process and encourages third-party
mediation.(2) - According to a servicing announcement issued Friday, Fannie Mae has established a maximum allowable fee of $2,200 for Hawaii judicial foreclosures.
- The company has also indicated that, because of potential title insurance issues, it may have to undo recent real estate owned (REO) acquisitions that resulted from nonjudicial foreclosures. "Upon being notified of any eliminations, servicers must immediately restart the matters as judicial foreclosures," Fannie Mae says of the REO properties.
Source: Fannie Instructs Servicers To Convert Hawaii Foreclosures.
For Fannie Mae's servicing announcement, see Hawaii Legislative Changes Affecting Non-Judicial Foreclosures.
(1) Inasmuch as Fannie Mae, in its announcement, makes no distinction between the handling of owner-occupied and non-owner occupied homes in foreclosure, its policy apparently applies to all of its delinquent home mortgages. Contrast this policy with the policy codified in the recently-passed Hawaii foreclosure law that allows homeowners facing non-judicial foreclosure to convert the process to a judicial foreclosure. Said conversion option is limited, however, to owner-occupied homes. See New Court Rules to Convert Non-Judicial Foreclosures to Judicial Foreclosures.
(2) For more on the new Hawaii foreclosure rules, see:
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