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New Law: Escrow for Hawaii TS's must be held in Hawaii

DeniseM

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Under a new law that went into effect July 1, 2010, you MUST use a licensed escrow company IN Hawaii to hold the funds. If you don't, and it is audited by the state, Hawaii can refuse to record the deed, and you won't be able to get the deed transferred to your name.

Here is a link to the law:
http://www.capitol.hawaii.gov/session2010/bills/SB2921_HD1_.htm

Here is a quote that sheds some light on this issue:

Some mainland closing agents are (for now) simply ignoring the Hawaii law. As Hawaii regulators get up to speed on their audit activities of these transactions, the dung will hit the fan. The violating closing agents will be fined the $5,000, per transaction.

You do not want to have an open escrow with such a closing agent if/when that happens.


*I know this info. has been discussed previously, but I think it needs to be a sticky.
 
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chester1122

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Good idea post this again. We got caught in this over the summer and are still trying to resolve a sale. Looks like we might need to start all over again with getting the documents signed. ( a reall hassle as we need to go to the US consulate in Canada).

The TS closing company should have known but our timing was over the July 1 date.
 

Fredm

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Good idea post this again. We got caught in this over the summer and are still trying to resolve a sale. Looks like we might need to start all over again with getting the documents signed. ( a reall hassle as we need to go to the US consulate in Canada).

The TS closing company should have known but our timing was over the July 1 date.

Our closing agents received notice of the new law late April/early May.
That gave us enough time to make appropriate arrangements.
 
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MLR

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RE: New Law: Escrow for Hawaii TS's

:shrug: OK, I am new to TUG. Hoping to 'give away' our Hawaii timeshare sometime.:shrug: If there are no funds exchanged, do you still need a Hawaii escrow agent? I am not familiar with RE transactions.
Thanks.........
 

DeniseM

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:shrug: OK, I am new to TUG. Hoping to 'give away' our Hawaii timeshare sometime.:shrug: If there are no funds exchanged, do you still need a Hawaii escrow agent? I am not familiar with RE transactions.
Thanks.........

No - if there is no money, there is no escrow.
 

Ready2Sell

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Escrow Co. in Hawaii

Do you know of any reputable escrow companies in Hawaii?
 

DeniseM

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I would start with a reputable closing company, that uses a Hawaiian Escrow company. Escrow companies only hold the funds - you need a closing company first.
 

Ready2Sell

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Reputable Closing Companies

Do you know of any reputable closing companies?
 

DeniseM

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MLR

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Hawaii Timeshare

No - if there is no money, there is no escrow.

Thank you all for your input. I have contacted one closing company and they will take care of things for $500. Does this sound fair? We haven't actually given the timeshare away yet - but am working on an ad now.
Anyone want a floating week, every odd year at Paniolo Greens?
Thanks again,
MLR
 

DeniseM

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Thank you all for your input. I have contacted one closing company and they will take care of things for $500. Does this sound fair? We haven't actually given the timeshare away yet - but am working on an ad now.
Anyone want a floating week, every odd year at Paniolo Greens?
Thanks again,
MLR

$500 for closing AND escrow in Hawaii? Did they guarantee escrow in Hawaii? Ask them for the name of the escrow company.

I hate to be the bearer of bad news, but you will most likely have to give away your Paniolo Greens TS. If you give it away, you don't need a full closing - just a simple deed transfer. I use a licensed document Prep company for free timeshares - they are listed in the TUG Reviews as Time Travel Traders and the owner is a Tugger - user name "ttt." They have an "A" rating on TUG. They can do a simple transfer, without escrow, for about $100.
 

MLR

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re: deed transfer

Yes, we realize we will be giving the timeshare away. If we lived on the West coast - there would be no problem - great fares to Hawaii. But, from the Midwest this year - good fares were slim pickens. And now, we are full time caregivers and cannot just drop everything and leave.

We were just hoping to do this as economically as possible. So, if there is NO escrow - $500 is steep, correct?

I am so grateful for TUG. So much good advice here.

thanks again
 

T_R_Oglodyte

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Yes, we realize we will be giving the timeshare away. If we lived on the West coast - there would be no problem - great fares to Hawaii. But, from the Midwest this year - good fares were slim pickens. And now, we are full time caregivers and cannot just drop everything and leave.

We were just hoping to do this as economically as possible. So, if there is NO escrow - $500 is steep, correct?
Yes - we just (last December) gave away a Hawaii TS to friends, using the TTT service that Denise mentioned.
 

DaveNV

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I used them as well for my last Hawaii giveaway sale, and I think they charged $125. The extra fee was because of the Hawaii requirement. They're a great outfit to work with.

dave
 

MLR

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Free TS

I used them as well for my last Hawaii giveaway sale, and I think they charged $125. The extra fee was because of the Hawaii requirement. They're a great outfit to work with.

dave

OK - how difficult was it to find someone to take the TS? How long did it take?

Did you advertise on TUG or elsewhere?
 

DaveNV

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OK - how difficult was it to find someone to take the TS? How long did it take?

Did you advertise on TUG or elsewhere?



I think it was on the Bargain Basement forum here at TUG. It went within a few days. (May have been eBay. I don't recall, but I didn't have to advertise very hard.) The trick was that I paid closing costs, Buyer only paid a dollar, and it was a quality week. But since closing costs were low, (under $250, including the recording fees and such), my out-of-pocket was minimal. Current year maintenance fees weren't yet due when the sale happened. But even if you have to eat the MF for the year, you're out from under the obligation starting next year, right?

Check the Stickies at the top of the Forums for info that helps make the most of things. I think there's one that talks about Buying and Selling.

Good luck!

Dave
 
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DeniseM

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alarenviro

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Which is the least expensive way to give away Hawaii TS?

We would like to prepare the deed ourselves to save money. Is it possible to do a quitclaim or warranty deed for a Free Kauai Hawaii timeshare and only pay the resort transfer fee and recording fee for Hawaii?
Thanks
 

alarenviro

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:shrug: OK, I am new to TUG. Hoping to 'give away' our Hawaii timeshare sometime.:shrug: If there are no funds exchanged, do you still need a Hawaii escrow agent? I am not familiar with RE transactions.
Thanks.........

We also want to give our Hawaii timeshare away. Anyone know of the forms we need to fill out and where to get them? Thanks so much for everyone's help.
 

DeniseM

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We also want to give our Hawaii timeshare away. Anyone know of the forms we need to fill out and where to get them? Thanks so much for everyone's help.

See post #17
 

Cathyb

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Possible suggestion...

Here are the TUG Business Ratings - that's a good place to start.

DeniseM: Would it be too difficult to designate the companies in the Business Ratings that are eligible to handle Hawaii timeshare sales/escrow/paperwork, etc? Perhaps an asterisk near their names and explanation of asterisk at the bottom?
 

DeniseM

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DeniseM: Would it be too difficult to designate the companies in the Business Ratings that are eligible to handle Hawaii timeshare sales/escrow/paperwork, etc? Perhaps an asterisk near their names and explanation of asterisk at the bottom?

Hi Cathy - Unfortunately, we don't have that information - if we did, it would be easy to make a note of it.

Clarification - You DON'T have to use a Hawaiian closing company - you only have to hold escrow in Hawaii. If there is no money involved - there will be no escrow.

In other words the law says the MONEY must be held in Hawaii - it doesn't say a Hawaiian closing company has to do the paperwork.
 

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Important info for Canadian buyers of a Hawaii TS

I'm posting this as a FYI for other Canadian buyers who may run into this situation; and, who may be asked to jump through unecessary hoops when buying into Hawaii.

This evening I spoke directly with the State of Hawaii's Bureau of Conveyances (BOC), regarding the need for notarized signatures by an American notary public, on the deed documents for TS purchases. I spoke with an officer named Scott Chang, of the Regular System Receiving dept., in charge of timeshares for the state of Hawaii - phone number 808-587-0147.

BUYERS don't always need a signature on the TS deed in Hawaii - the signature line remains blank. As the grantee, they DON'T always need to sign. If there is no signature, there is nothing to notarize. If there is nothing to notarize, there is no need to seek an American notary public. The State of Hawaii only requires the SELLER to always sign the deed and have the signatures properly notarized. However, once a buyer's physical signature appears -- the authorized notary requirements kick in.

We ran into this exact situation with a recent purchase in Hawaii: we were instructed to physically sign the deed when it wasn't required, as wrongfully instructed by Cheryl Mulberry of Capital Resort Transfers. She also failed to notify us regarding the proper notarization process. This caused us problems...

SELLERS' ( and some buyers') signatures are properly notarized in the State of Hawaii if signed by an American notary public. In the case of Canadians, Hawaii also accepts the notary seal of a U.S. Consular Officer or a Canadian notary's seal in combination with a red "Apostille"-like seal from another authorized Canadian source (sort of a notary's notary process).

This is why the electronic document filing for another TS week we bought (at around the same time, also at Paniolo Greens) went through so smoothly with Timeshare Closing Services - we did not have a physical signature on the actual deed. No signature = no need for a notary.

So, we should not have signed the other deed in the first place -- there was absolutely no need to. We were subjected to a "broiler template" work method that did not at all account for: a) the fact that we were not U.S.-based buyers, and b) that it was a Hawaii TS property.

So, for Canadian BUYERS, the key seems to find out first if you really need to physically sign the TS deed for the resort you are buying into. The State of Hawaii's BOC is fine with NOT signing a deed and it avoids a lot of unnecessary hassles, expense and stress. And you may need to firmly dig your heels in on this point if the purchase goes to escrow, depending on the resort.

I hope this helps for future reference.

Clarifications to the original post: It was pointed out to me on a related thread that some Hawaii resorts' deeds do require a buyer signature, if these contain certain conveyances. I would suspect that buying into a system/club, the requirement for a buyer signature would have to be different also. So you must first check to see if you are buying into a resort where you can avoid signing the deed. DO NOT trust the closing company on this!! Do the checking yourself.

For Paniolo Greens specifically (not Shell at PG), neither the State of Hawaii, nor the resort itself, require the buyers' signature for the transfer of the title deed. I have verified this point with both. So, in this case, blindly accepting an admin clerk's application of a generic template is not at all in the best interest of Canadians buying into Paniolo Greens.

Now for the transactions which DO require a notarized signature: if a Canadian notary's signature is itself officially authorized & "sealed", IT IS legally valid in the U.S. Canada is not signatory to the Hague agreement (for legalizing documents), so in fact, the "Apostille" seal does not apply to Canadians as such. But a similar process does exist; which means that, for example in Regina or Victoria, you can still get properly notarized documents for the U.S. without being limited to having to go to a Consulate or to a U.S. notary public.

The key here is that, essentially, a Canadian notary needs to have their own signature properly authenticated and legalized with an "Apostille"-equivalent seal. Which is why things got so screwy with one of the closing companies that we recently dealt with - and this is the route that has been used to get the deed registration process finally on its way.
 
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Ready2Sell

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Hi Cathy - Unfortunately, we don't have that information - if we did, it would be easy to make a note of it.

Clarification - You DON'T have to use a Hawaiian closing company - you only have to hold escrow in Hawaii. If there is no money involved - there will be no escrow.

In other words the law says the MONEY must be held in Hawaii - it doesn't say a Hawaiian closing company has to do the paperwork.

So, if want to give my TS that is in Hawaii to my son and we do a private transaction, I can use a closing company in California to transfer the deed to him, correct.
 

DeniseM

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So, if want to give my TS that is in Hawaii to my son and we do a private transaction, I can use a closing company in California to transfer the deed to him, correct.

Yes - Only escrow (money) has to be held in Hawaii. No money = no escrow.
 
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