HB1306 Summary

• Establishes the Kupuna Home Equity Conversion Mortgage Program administered by the Hawaii Housing Finance and Development Corporation to provide reverse mortgages for homeowners aged 62 and older with limited retirement income.

• Requires mandatory independent third-party counseling for all kupuna homeowners before loan closing, with counselors discussing alternative housing options, financial implications, and potential tax and benefits consequences.

• Limits aggregate insured mortgages to 275,000 and caps origination fees at 2% of the maximum claim amount up to $200,000 plus 1% above that amount, with an absolute maximum origination fee of $6,000.

• Requires mortgagees to provide annual statements to homeowners summarizing principal paid, deferred interest added, and outstanding loan balance, plus cost projections before closing.

• Protects homeowners from displacement by deferring loan repayment until death, home sale, or other specified events, and requires the corporation to assist in relocating to affordable rental housing when home equity is exhausted.