A landmark Hawaiʻi Supreme Court decision gives lenders like BNY Mellon a twenty-year window to foreclose – reshaping risk and timelines for mortgage professionals
The Hawaiʻi Supreme Court says lenders have twenty years to start a foreclosure – ending years of uncertainty for mortgage professionals statewide.
On August 7, 2025, the state’s highest court resolved a long-standing question for the mortgage industry – how long does a lender have to bring a foreclosure action after a borrower defaults? The case involved The Bank of New York Mellon, which became the holder of a $250,000 mortgage originally executed by Brenda Merle White with Countrywide Home Loans, Inc. in 2006. White stopped making payments in February 2008, and the mortgage was assigned to The Bank of New York Mellon in July 2008. That same month, the bank sent White a notice of intent to foreclose, but later rescinded the notice in 2010 and did not proceed with foreclosure at that time.
In 2012, the Association of Apartment Owners of Kumelewai Court, a junior lienholder, foreclosed on the property for unpaid maintenance fees. After an auction, Gabi Kim Collins acquired an interest in the property in 2015 via quitclaim deed, though Collins was not a party to White’s mortgage.
In November 2017, The Bank of New York Mellon sent White a notice of default and filed a foreclosure action in the Circuit Court of the First Circuit. White did not respond, but Collins did, arguing that the bank had missed the deadline to foreclose. Collins claimed the loan was accelerated in 2008, and that under Hawaiʻi law, the bank only had six years to act.
The bank countered that the statute of limitations for a foreclosure action is twenty years under Hawaiʻi Revised Statutes § 657-31, because foreclosure is more like a real property action than a debt recovery action. The Circuit Court agreed with the bank, granting summary judgment, and the Intermediate Court of Appeals affirmed the decision.
Collins appealed to the Hawaiʻi Supreme Court, arguing that the lower courts were wrong and that the six-year period should apply. On August 7, 2025, the Supreme Court affirmed the lower courts, holding that mortgage foreclosure actions are governed by the twenty-year statute of limitations under HRS § 657-31. The court explained that foreclosure actions are more analogous to actions involving real property than to actions for debt recovery, and that precedent supported this interpretation. The court rejected arguments that previous cases should be overturned or that the law should be interpreted differently because Hawaiʻi is a lien theory state.
For mortgage professionals, this decision brings welcome clarity. The court’s ruling means lenders and servicers in Hawaiʻi have a much longer window to initiate foreclosure proceedings, reducing risk and uncertainty when managing mortgage portfolios. The decision does not turn on the size of the loan or the prominence of the parties, but on a legal principle that affects the entire industry.
The August 7 decision is not about headlines or drama - it’s about removing ambiguity for mortgage professionals and providing a clear, practical rule for foreclosure timelines in Hawaiʻi. For anyone in the business of managing or enforcing mortgages in the state, that’s a win for certainty and predictability.
