2015 MS FAQs General Information



 These questions and answers constitute informal guidelines only and do not constitute legal advice or rules by DFI.  Any interpretations of Chapter 454M, HRS, are specific to the facts and circumstances in each particular situation.  Questions and answers will be updated and supplemented as DFI develops additional guidance.  Additional answers can be found using the NMLS Resource Center.

If additional guidance is required on a unique situation in your company or for yourself, you may send your inquiry via letter or email to:

Division of Financial Institutions
Department of Commerce and Consumer Affairs
P.O. Box 2054
Honolulu, HI 96805
[email protected]


What law governs mortgage servicers?
Chapter 454M, Hawaii Revised Statutes (“HRS”), entitled, “Mortgage Servicers”.  The chapter was most recently amended by Act 62 of the 2015 Hawaii Legislature, effective May 28, 2015.

Who administers the Mortgage Servicers law?
The Mortgage Servicers law is administered by the Division of Financial Institutions (“DFI”) of the State of Hawaii Department of Commerce and Consumer Affairs (“DCCA”).  DFI is headed by the Commissioner of Financial Institutions (“Commissioner”).

DFI is charged with the overall supervision and regulation of all state-chartered and state-licensed financial institutions in the State of Hawaii (including banks, savings banks, foreign bank branches, agencies and representative offices, savings and loan associations, trust companies, depository and nondepository financial services loan companies, and credit unions), escrow depositories, money transmitters, mortgage servicers, mortgage loan originators, and mortgage loan originator companies.  DFI does not supervise or regulate national banks, federal savings banks or federal credit unions.

Who is a mortgage servicer under Hawaii law?
Under Chapter 454M, HRS, a mortgage servicer is the person responsible for collecting, receiving, and processing scheduled periodic payments from a borrower under terms of a residential mortgage loan, including amounts for escrow accounts, and making the payments to the owner of the loan or other third parties in accordance with terms of the mortgage servicing loan documents or servicing contract.  In the case of a home equity conversion mortgage or reverse mortgage as referenced in Chapter 454M, HRS, servicing includes making payments to the borrower.   Section 454M-1, HRS.

Some mortgage lenders make mortgage loans and also service them.  Others make mortgage loans and sell the servicing rights to some or all of those loans.

A person meeting the definition of a mortgage servicer, but assigns the responsibility of collecting, receiving, and processing scheduled periodic payments from a borrower must also be licensed.

Who is a “person” under the Mortgage Servicer law?
“Person” means an individual, partnership, corporation, association, or other organization.  Section 454M-1, HRS.

What is a residential mortgage loan?
“Residential mortgage loan” means a mortgage loan, home equity loan, or reverse mortgage loan, that is secured by a first or subordinate a lien residential real property located in Hawaii.  This includes a refinance of a loan on Hawaii residential real property upon which housing for one to four families is or will be constructed, or a manufactured home is or will be placed on the property using loan proceeds.  Section 454M-1, HRS.