Haw. Code R. § 15-309-14 - Repayment of corporation's equity and payment of equity percentage share
(a) Qualified purchasers shall repay the
corporation's equity
(1) Any time after
financial closing at will of the purchaser;
(2) Upon sale or transfer of the
unit;
(3) Prior to expiration of
the thirty years from the qualified purchaser's sale closing date;
(4) When the qualified purchaser obtains
additional financing or refinances the original mortgage loan including to pay
the corporation's net share of appreciation;
(5) When the qualified purchaser no longer
uses the unit as the qualified purchaser's principal and physical residence but
continues to retain legal or equitable title to the unit, or both;
(6) When the qualified purchaser rents the
unit or any part of the unit to someone else but continues to retain legal or
equitable title to the unit, or both; or
(7) When the qualified purchaser fails to
reoccupy the unit at the end of the temporary waiver
period.
(b) Payments
accepted shall be applied in the following order of priority: corporation's (i)
equity interest; (ii) equity percentage share, if any; and (iii)
equity.
(c) If the corporation's
equity and equity percentage share is not paid when due, interest on the
corporation's equity share shall accrue at the simple annual rate of ten per
cent per year until paid.
(d) If
after thirty years a purchaser has not repaid the corporation's equity,
including any accrued interest, and the corporation's equity percentage share,
if any, the corporation may undertake the following actions to seek repayment:
(1) Submittal of a demand letter to the
qualified purchaser;
(2) Placement
of a lien on the unit; and
(3)
Judicial foreclosure of the unit.
(e) Payment of the corporation's equity and
equity percentage share, if any, shall be the sum of the following:
(1) The corporation's equity plus simple
interest at the rate of one per cent per year, unless otherwise indicated in
the qualified purchaser's program agreement, on the corporation's equity to the
qualified purchaser; and
(2) The
net appreciation on the corporation's equity calculated as the current value of
the unit, minus the original value of the unit specified in the purchaser's
program agreement, and multiplied by the corporation's equity percentage
share.
Notes
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