§506-7 Mortgages on real property, damage or destruction of collateral. Notwithstanding any provisions to the contrary in any agreement between a mortgagor and a mortgagee, if residential real property which is the subject of a mortgage securing a loan is damaged or destroyed by fire, earthquake, tidal wave or any natural disaster, the rate of interest on the loan shall not be increased by reason of the damage or destruction and the proceeds of any insurance insuring against such damage or destruction shall be applied, at the option of the mortgagor, to reduce the indebtedness due under the loan or to repair, restore or rebuild the residential real property. [L 1980, c 188, §5] Law Journals and Reviews Hawai`i 2000 Report Regarding Lawyers' Opinion Letters in Mortgage Loan Transactions. 22 UH L. Rev. 347 (2000).
Hawaii Legal Code