§516-35.1  Foreclosure and sale by
mortgagees.  If the leased fee, fee simple title or lease to a lot,
purchased or acquired from the Hawaii housing finance and development corporation
under this chapter is secured by a mortgage held by a lending institution
authorized to do business as a lending institution either in the State or
elsewhere in the United States, upon foreclosure of the mortgage, the leased
fee, the fee simple title or the lease may be sold to any purchaser, including
the holder of the mortgage, without regard to whether or not the purchaser is
qualified under the provisions of this chapter to own or otherwise acquire the
leased fee, the fee simple title, or the lease.  The mortgage so held, and the
interest so acquired by the purchaser on such foreclosure, shall be freely
assignable, notwithstanding the provisions of section 516-35.  The term,
"lending institution," includes an insurer or guarantor of the
obligation or condition of the mortgage, including the Federal Housing Administration,
the Federal National Mortgage Association, the Veterans Administration, or any
other federal agency and their respective successors and assigns or any lending
institution authorized to do business in the State or elsewhere in the United
States; provided that the rights and powers of nongovernmental holders of
mortgages shall not be any greater than those of the aforementioned federal
agencies.



Notwithstanding any provision in this chapter
to the contrary, in sales by the corporation of the leased fee or the fee
simple title, or in leases of lots, the corporation may waive or modify any
restrictions contained in this chapter, if such waiver or modification is
necessary to enable any of aforementioned federal agencies or any lending
institution authorized to do business in the State or elsewhere in the United
States to participate in any loan secured by a mortgage on the leased fee, the
fee simple interest or the lease; provided any such waiver or modification
shall not confer any greater rights or powers in the holder than those which
would be required by the Federal Housing Administration. [L 1968, c 46, §2i; am
L 1987, c 337, §16; am L 1988, c 104, §2; am L 1997, c 350, §14; am L 2005, c
196, §26(b); am L 2006, c 180, §16]



 



Note



 



  Veterans Administration referred to in text is now the Department
of Veterans Affairs.