HAR §15-216-38. Foreclosure

In the event of a foreclosure, any law to the contrary notwithstanding, a mortgagee under a mortgage covering a reserved housing unit and land or leasehold interest subject to the restrictions of sections 15-216-35 (term of 216-15 30 5 3 30 5 3 §15-216-38 reserved housing requirements), 15-216-36 (first option to purchase), and 15-216-37 (sale of transfer of reserved housing units), shall, prior to . commencing mortgage foreclosure proceedings, notify the authority of: (1) Any default of the mortgagor under the mortgage within ninety days after the occurrence of the default; and (2) Any intention of the mortgagee to foreclose the mortgage under chapter 667, HRS. The authority shall be a party to any foreclosure action, and shall be entitled to all proceeds remaining in excess of all customary and actual costs and expenses of transfer pursuant to default, including liens and encumbrances of record. The person in default shall be entitleq to any amount remaining provided the amount shall not exceed the lower of the amounts computed in section 15-216-35 (term of reserved housing requirements). [Eff OCT 2 7 2012 J (Auth: HRS §§206E-4, 206E-5, 206E-7) (Imp: HRS §§206E-4, 206E-5, 206E-7) §15-216-39 Transfers of title pursuant to a mortgage foreclosure. The conditions prescribed in sections 15-216-35 (term of reserved housing requirements), 15-216-36 (first option to purchase), and 15-216-37 (sale of transfer of reserved housing units) shall be automatically extinguished and shall not attach to subsequent transfers of title pursuant to a mortgage foreclosure, foreclosure under power of sale, or a conveyance in lieu of foreclosure after a foreclosure action is commenced. [Eff OCT 2 7 2012 ] (Auth: HRS §§206E-4, 206E-5, 206E-7) (Imp: HRS §§206E-4, 206E-5, 206E-7) §15-216-40 Incorporation in deed. The provisions of sections 15-216-33 (occupancy requirements), 15-216-35 throu~h 15-216-37, 15-216-40 (incorporation in deed) and section 15-216-41 (equity sharing requirements) shall be incorporated in any I • 216-16 §15-216-41 deed, lease, mortgage, agreement of sale, or other instrument of conveyance for reserved housing units. [Eff OCT 2 -7 2012 ] (Auth: HRS §§206E-4, 206E-5, 206E-7) (Imp: HRS §§206E-4, 206E-5, 206E-7) §15-216-41 Equity sharing requirements. (a) The authority's share of the equity in the reserved housing unit shall become due upon resale of the reserved housing unit. (b) The authority's share of the equity in the reserved housing unit shall be the higher of: (1) An amount equal to the difference between the original fair market price of the unit as determined by the authority and its original sales contract price; or (2) An amount equivalent to the percentage of net appreciation calculated as the difference between the original fair market price of the unit as determined by the authority and its original contract price divided by the original fair market price of the unit. (c) At its sole discretion, the authority may allow the project developer to buy out the shared appreciation provisions for all or a portion of the reserved housing units by making a cash payment to the authority of an amount equal to the amount for equity sharing calculated in subsection (b) above. (d) The owner of the reserved housing unit shall provide financial documents acceptable to the authority before the cost of improvements made by the owner can be de~ucted from the sale price. (e) The authority, in its sole discretion, shall determine the fair market value of the reserved housing unit at the time of original sale and also at the time of resale. (f) The resale pricacfT7tftjff-s shall be approved by the authority. [Eff ] (Auth: HRS §§206E-4, 206E-5, 206E-7) (Imp: HRS §§206E-4, 206E-5, 206E-7) 216-17 Jo 5 J §15-216-42 §15-216-42 Deferral of equity sharing. The authority may consider deferring the equity sharing in case an owner of a reserved housing unit wishes to transfer title to the unit by devise or through the laws of descent to a family member who would otherwise qualify for purchase of a reserved housing unit under this chapter. [Eff nrT 2 ,n12 1 (Auth: HRS §§206E-4, 206E-5, 206~Y7) fitrrr,: HRS §§206E-4, 206E-5, 206E-7) §15-216-43 Effects of subsequent rule amendments. (a) In the case of subsequent rule amendments, reserved housing owners shall be permitted at their election to: (1) R,emain subject to the rules in effect at the time of the purchase of the unit, or (2) Be governed by the amended rules. · (b) The-authority, or any other entity that the authority transfers the reserved housing to shall notify all reserved housing owners of any change made by law, ordinance, rule or regulation within one hundred eighty days of such changes. Such notice shall clearly state the enacted or proposed new provisions, the date upon which they are to be effective and offer to each owner of reserved housing units constructed and sold prior to the effective date, an opportunity to be governed by such new provision. (c) No reserved housing unit owner shall be entitled to modify the restrictions or conditions on use, transfer, or sale of the reserved housing unit, without the written permission of the holder of a duly-recorded first mortgage on the unit and the owner of the fee simple or leasehold interest in the land underlying the unit. (d) This section shall apply to all reserved housing units developed, constructed and sold pursuant to this chapter. [Eff OCT 2 7 2012 J (Auth: HRS §§206E-4, 206E-5, 206E-7) (Imp: HRS §§206E-4, 206E-5, 206E-7) §§15-216-44 to 15-216-54 (Reserved). 216-18 liJ DEPARTMENT OF BUSINESS, ECONOMIC DEVELOPMENT, AND TOURISM Repeal of chapter 15-200 and adoption of chapter 15-216, Hawaii Administrative Rules, on the Summary Page dated September 11, 2012, were adopted on September 11, 2012, following public hearings held on May 18, 2011, August 16, 2012, and September 11, 2012, after public hearing notices were given in the Honolulu Star Advertiser, Hawaii Tribune-Herald, The Maui News, West Hawaii Today, and The Garden Island, on April 16, 2011 and July 16, 2012. These rules shall take effect ten days after filing with the Office of the Lieutenant Governor. 1-- Ll CJ N .-. AS TO FORM: Executive Dire r Hawaii Community Development Authority Qv~ ::b~';?~ ~ G Di.rector Department of Business, Economic Development, and Tourism ey General ~~ NEILABRCR.0MBI E Governor State of Hawaii Date: Filed 216-19 30 5 3