Here are some key facts about foreclosure in Washington State:
- Judicial Foreclosure Available: Yes
- Non-Judicial Foreclosure Available: Yes
- Primary Security Instruments: Deed of Trust, Mortgage
- Timeline: Typically 120 days*
- Right of Redemption: Yes, but may be precluded.
- Deficiency Judgments Allowed: Yes**
In Washington, lenders may foreclose on deeds of trusts or mortgages
in default using either a judicial or non-judicial foreclosure process.
Judicial Foreclosure
The judicial process of foreclosure, which involves filing a
lawsuit to obtain a court order to foreclose, is used when no power of
sale is present in the mortgage or deed of trust. Generally, after the
court declares a foreclosure, the property will be auctioned off to the
highest bidder.
Non-Judicial Foreclosure
The non-judicial process of foreclosure is used when a power of sale
clause exists in a mortgage or deed of trust. A "power of sale" clause
is the clause in a deed of trust or mortgage, in which the borrower
pre-authorizes the sale of property to pay off the balance on a loan in
the event of the their default. In deeds of trust or mortgages where a
power of sale exists, the power given to the lender to sell the
property may be executed by the lender or their representative,
typically referred to as the trustee. Regulations for this type of
foreclosure process are outlined below in the "Power of Sale
Foreclosure Guidelines".
Power of Sale Foreclosure Guidelines
If the deed of trust or mortgage contains a power of sale clause and
specifies the time, place and terms of sale, then the specified
procedure must be followed. Otherwise, the non-judicial power of sale
foreclosure is carried out as follows:
- The notice of sale must be transmitted both by regular mail and by
certified mail, return receipt requested, to the borrower at their last
known address, and by regular mail to the attorney of record for the
borrower, if any, not less than thirty (30) days prior to the day of
sale. The sheriff must publish a notice of the sale once a week,
consecutively, for four (4) weeks, in any daily or weekly legal
newspaper of of general circulation published in the county in which
the property is located. Additionally, the sheriff must also post the
notice in two public places, one of which must be the courthouse door,
in the county where the sale is to take place for a period of not less
than four weeks prior to the day of sale. Said notice must contain the
time and place of the foreclosure sale, the names of the parties to the
deed, the date of the deed, recording information, a property
description, the terms of the sale, and the borrowers rights (or lack
of) redemption. - The borrower has up to eleven (11) days before the sale stop the
foreclosure process by paying the past due payments, plus expenses,
including trustee and attorney fees. - The sale must be made by auction between 9:00 am in the morning and
4:00 am in the afternoon at the courthouse door on Friday unless Friday
is a legal holiday and then the sale must be held on the next following
regular business day. The sale may not be conducted less than 190 days
from the date of default and the highest bidder will receive a
certificate of sale. The sheriff may postpone the sale (not exceeding
one (1) week next after the day appointed) by giving notice and by
posting written notices of the adjournment under the notices of sale
originally posted.
Unless redemption rights have been precluded, the borrower may,
within eight (8) months after the date of the sale, redeem the property
by paying the amount of the highest bid at the foreclosure, plus
interest.
*If the non-judicial foreclosure process is used by the lender,
then it cannot sue for a deficiency judgment. On judicial foreclosure
sales, the borrower can be sued for a deficiency, unless the property
is found to be abandoned for six (6) months before the decree of
foreclosure.
**If banks know your working on a short sale they will most likely delay the foreclosure process.
Resources from: Chapter 61.12 RCW Foreclosure of real estate mortgages and personal property liens and http://www.foreclosurelaw.org
More Resources for Washington State Residence
- Washington State Homeownership Information Program Free
foreclosure counseling, classes, workshops, and resources available to
Washington State residents. Speak To A HUD Approved Counselor:
1-877-894-HOME www.homeownership.wa.gov - Obama's Making Home Affordable Program Through President
Obama's Making Home Affordable program, Washington families may be
eligible to refinance or modify their loans to a payment that is
affordable. http://www.makinghomeaffordable.gov - Partial Claim Program For FHA Loans In Foreclosure If you
have an FHA loan in foreclosure you may be eligible for a partial claim
program. The program is called the FHA-Home Affordable Modification
Program, or FHA-HAMP. The program is designed to help borrowers retain
their homes and to prevent the destructive impact of foreclosures on
families and communities. The program is available to borrowers who do
not qualify for the existing FHA special forbearance or loan
modification. https://www.hmpadmin.com/portal/index.html - FDIC Foreclosure Prevention Initiative
The FDIC has launched a program to help prevent both unnecessary
foreclosures and fraudulent rescue scams by encouraging loan
modification, providing an FDIC phone line to direct borrowers to
legitimate mortgage counselors, and creating a foreclosure information
"tool kit".
FDIC Call Center: 1-877-275-3342
Foreclosure Prevention Toolkit - Property Tax Deferral Program
Struggling to make ends meet? The Department of Revenue has program
that can help. The Property Tax Deferral Program helps homeowners with
limited income by paying 50 percent of property taxes and/or special
assessments on behalf of the owner. The taxes are postponed and must be
paid when the homeowner no longer owns and uses the property as their
primary home. For more information and a list of requirements visit dor.wa.gov or call (360) 570-5900, or call your local county assessor’s office.
If you or someone you know is facing foreclosure have them contact a
CDPE in there area right. A Certified Distressed Property Expert® is
a real estate professional with specific understanding of the complex
issues confronting the real estate industry, and the foreclosure
avoidance options available to homeowners. Through comprehensive
training and experience, CDPEs are able to provide solutions for
homeowners facing hardships in today’s market, specifically short sales.
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