Foreclosure Process in Washington

By: Kathy Swift

Washington

The state of Washington uses both in-court and out of court foreclosure proceedings.  Judicial or in-court foreclosure is used when the language in the mortgage or deed of trust does not contain a power of sale clause.  Should this be the case, the bank must get the court's permission to foreclose or in otherwords the need to get a court order to move forward with the sale of the property.  After this has been obtained, the lender will proceed with the foreclosure process, and auction of the home.  To use judicial foreclosure the bank's attorney must file a law suit against the home owner who is having difficulty making his house payments.  This is done to get the court's permission to sell the house to try to collect on what is owed on the loan.  This is a much longer and more expensive process than non judicial foreclosure and so it is not used very often.

Non judicial foreclosure is the most popular method of foreclosure.  This is the case becaue it saves the lender both time and money.  Since it is in the bank's best interest to spend as little time and money on this process as possible and it is their choice as to which process to use, non judicial foreclosure will almost always be the method used to sell the home.

A power of sale clause is the language in a mortgage or deed of trust that allows a lender to foreclose on a defaulted loan without going through the court system to do so.  When a power of sale clause does exist in the mortgage or deed of trust, then non-judicial or out of court foreclosure is followed.  This is almost always the case.

To proceed with an out of court foreclosure in Washington, the lender must start by sending a notice of sale letter to the home owner by both regular mail and by certified mail, return receipt requested.  This notice of sale must be sent to the home owners last known address.

If the home owner has an attorney of record, it must be sent to that person as well.  The time frame required for this notice of sale to be sent is a minimum of thirty days prior to the sale.

Other requirements to move ahead with an out of court foreclosure in Washington include that the sheriff must publish or advertise the notice of sale once a week for four weeks leading up to the sale date.  This advertisement can be placed in any newspaper that has circulation in the county where the property is located.  Also the sheriff must post this notice of sale on the court house door in the county where the property is located.

The sheriff must post this notice on at least one other public place as well.  These public postings can be placed anywhere considered a public place, like the county office building or the library etc.  The placing of the public postings is completely up to the discression of the county sheriff. These public postings must also take place four weeks before the sale date.

This notice of sale must include the time and place of the auction, the names on the deed, the date of the deed, recording info, a description of the property and the terms of the sale.

In Washington the home owner can stop the foreclosure proceedings by paying the past due payments, plus other expenses the lender has incurred in the process.   Those costs will include, but are not restricted to the lawyer’s fees involved.  The home owner can halt the process this way as late as eleven days before the sale date.

In Washington the auction of the property is always held between 9:00 am and 4 pm on Friday at the courthouse door.

If the Friday that is closest to the date chosen by the lender happens to fall on a legal holiday, the sale will be held on the next business day.  In this state, the auction cannot be held any sooner than the 190 days following the date the notice of default was issued by the lender.

The obtaining of the property by the highest bidder, in Washington, is confirmed by the receipt of a certificate of sale. 

In Washington, the sheriff can postpone the sale for a maximum of 1 week.  If the sheriff chooses to do so, then the notices must be posted as they were prior to the original sale date.

Home owners have an eight month right of redemption in this state.  This means that should the person who lost the home at auction be able to come up with the amount of money of the winning bid at auction, plus interest, then they can again enjoy ownership of the property.

This doesn’t happen often, but it does mean that the new owner or the person who placed the winning bid must worry for eight months about whether or not the home is really theirs.  If it were me, I would certainly refrain from putting anymore money into the house.  I would also consider not moving into the house until the 8 months following the sale have expired.

If the lender chooses to pursue an out of court foreclosure in Washington, it foregoes any chance it might have had to pursue the borrower for a deficiency judgment.  That means they can’t seek any additional money not generated by the sale of the home. 

If the lender chooses to follow an in court foreclosure, they can follow that decision or out come up with and additional pursuit of the borrower for any funds they feel they are due above what is gained through the sale.  The only exception to this rule is that if the property is proven to have been abandoned for six months before the decree of foreclosure was issued, by the court.  In this situation, further pursuit of the borrower for money is prohibited.

Because most forclosures in his state are out of court processes.  This means that lenders rarely have the right to seek a deficiency judgent. This is of course good news to the person who looses their home at the foreclosure sale.

Integrity 1st Consulting is your specialist- Kathy Swift

Foreclosures
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