STAND. COM. REP. NO.140-02
Honolulu, Hawaii
, 2002
RE: H.B. No. 2642
H.D. 1
Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twenty-First State Legislature
Regular Session of 2002
State of Hawaii
Sir:
Your Committee on Human Services and Housing, to which was referred H.B. No. 2642 entitled:
"A BILL FOR AN ACT RELATING TO THE HAWAII HOME LOAN PROTECTION ACT,"
begs leave to report as follows:
The purpose of this bill is to protect potential homebuyers from predatory lending practices by establishing the Hawaii Home Loan Protection Act (HHLPA).
Specifically, this bill:
(1) Prohibits creditors of home loans from certain practices;
(2) Provides rights to the borrower to cure the default prior to foreclosure or seizure of the home; and
(3) Provides remedies for violations to HHLPA, including criminal penalties.
The Department of Commerce and Consumer Affairs, Hawaii Credit Union League, Hawaii State AFL-CIO, Legal Aid Society of Hawaii, the ILWU, Kokua Council, AARP Hawaii, and a concerned individual submitted testimony in support of this measure. The Hawaii Government Employees Association supported the intent of this measure.
The Hawaii Association of Mortgage Brokers, Mortgage Bankers Association of Hawaii, Hawaii Financial Services Association, and the Hawaii Bankers Association opposed this measure.
Your Committee finds that the number of home foreclosures is increasing and that it may be associated with unfair lending practices. One testifier, an attorney, has handled several cases where fees were increased exorbitantly in a deceiving manner. Predatory lenders target vulnerable individuals such as the elderly, women, minorities, and lower-income households.
Your Committee has amended this bill by:
(1) Increasing the amount of the late payment fee from four percent of the amount past due to five percent;
(2) Allowing creditors who acted in good faith, but failed to comply with HHLPA, a specific amount of time to rectify the error; and
(3) Making technical, nonsubstantive amendments for purposes of clarity and style.
As affirmed by the record of votes of the members of your Committee on Human Services and Housing that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2642, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2642, H.D. 1, and be referred to the Committees on Consumer Protection and Commerce and Judiciary and Hawaiian Affairs.
Respectfully submitted on behalf of the members of the Committee on Human Services and Housing,
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____________________________ MICHAEL P. KAHIKINA, Chair |