LAHAINA, Hawaii, Sept. 18, 2023 /PRNewswire/ — Many Lahaina homeowners who have survived the fire are now at threat of foreclosure. Federal regulations permit most homeowners a ninety-day forbearance on the payment of their mortgages due to natural disaster. After that time, they must begin making payments again and also pay the three months of missed payments.
Most of these homeowners no longer have homes; many remain displaced in temporary housing and are without work. It is estimated that rebuilding will take at least three years.
Maui attorney Lance D. Collins has formally requested that the Federal Housing Administration, the Federal Housing and Financing Agency, Government National Mortgage Association and the Veterans Affairs Benefits Administration require mortgage lenders to declare a general deferment of both mortgage payments and the accrual of interest for three years and to extend the maturation date of any loan by three years or allowing the re-amortization of the three years over the life of the loan.
Collins is also calling on Governor Josh Green to use his emergency powers to suspend the Foreclosure Law for residential properties in the burnout zone in Lahaina and to strongly encourage lenders to work with property owners on deferments and loan modifications.
Collins said, “Without immediate intervention, the Lahaina community will next be faced with a tsunami of foreclosures while predatory land grabbing will reign under the cloak of legal process.”
Several local banks have offered forbearance, meaning that interest continues to accrue and that the missed payments with the additional interest are tacked on at the end of the loan’s term. This request to federal regulators is for a general deferment and an extension on the maturity date of loans, meaning that no interest accrues during the deferment and that the loan term is extended by the period of the deferral — avoiding any increase in the amount of payments and avoiding balloon payments.
Lance D. Collins is a Maui attorney who, along with Honolulu attorney Harrison L. Kiehm, leads the Mālama Law Group. The Mālama Law Group represents property owners, renters, businesses and families who have lost loved ones in the Maui fire, having filed one of the first lawsuits arising from the fire that destroyed Lahaina. Collins’ and Kiehm’s offices have united to form Mālama Law Group. Joining the Mālama Law Group from California is native Hawaiian attorney Kristine Kalama Keala (formerly Meredith), managing partner of Danko Meredith, a preeminent utility wildfire firm that has won over $1 billion in cash compensation for survivors of utility fires.
SOURCE Danko Meredith
