Reps. Pine and Riviere address SB 2394 – Lending Practices

Rep. Riviere asked HI Credit Union League: Q: What is most troubling about this bill? A: The Second Part. (We are OK with First Part.) Second Part could put taxpayer money in jeopardy. Rep. Yamane asked AG: Q: Wouldn’t condemnation be allowed, for public purposes, since we buy distressed property? A: Eminent domain is for real property. There are problems with using eminent down for personal property. Mortgages, we consider, are more personal property. (AG told Rep. Ichiyama they would do research on laws in other states.) Rep. Jordan asked AG: Q: What do you do for forgiveness of debt? Who takes on responsibility? A: Not sure how transaction could go. If homeowner owns the debt at the time, then it would apply to homeowner. If State, then State. Q: What about deficiency judgment? A: Homeowner will still owe. It’s like a monkey on your back. Q; Does that liability affect income tax of homeowner? A: Don’t know. Q: If I was the homeowner, will I still be burdened with having to pay tax on forgiven debt? A: Yes.

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