Washington State is a non-judicial foreclosure state, meaning that the lender is not required to sue the borrower in default in order foreclose. Most home loans in Washington State are based on a deed of trust (mortgage instrument) with a “power of sale” clause that pre-authorizes the sale of the property to pay off the balance of the loan in the event of a default by the borrower. When this clause exists, the power given to the lender to sell the property is usually executed by the lender’s representative, typically referred to as the trustee.
While Washington State has minimum timelines required by state law, this is the timeline typically followed by most lenders:
90 days after the first missed payment: Lender sends a “Notice of Default” to the borrower. The notice will be posted at the property (usually taped on or near the front door) or delivered to the borrower in person. The notice may also be mailed to the borrower, usually by certified mail. The borrower has 30 days to respond before the actual foreclosure process is started and the property is scheduled for public sale.
120 days after the first missed payment: Lender records a Notice of Trustee Sale with the county recorder, stating the scheduled sale (auction) date. The notice of sale must be recorded at least 90 days before the sale date. The notice of sale is also posted at the property or delivered to the borrower in person, and mailed to the borrower and any other affected parties (such as additional lienholders).
Approximately 7 months after the first missed payment: Property is sold at public auction to the highest bidder, who must pay in cash at the time of the auction. If nobody bids the minimum bid amount set by the lender, ownership of the property will revert back to the lender. The winning bidder, or the lender if there were no bids, can take possession of the property 20 days after the foreclosure sale. The borrower has no right to redeem the property after the foreclosure sale. Foreclosure sales are usually held on the county courthouse steps each Friday, or the next business day if Friday is a holiday.
The timelines above are the most common timelines. Actual timelines specified by Washington State are:
- The foreclosure sale must be scheduled a minimum of 190 days from the date of default.
- The borrower has up to 11 days before the foreclosure sale to stop the foreclosure process by paying the past due payments, plus expenses and legal fees.
- The lender may postpone the foreclosure sale at their discretion. This will often times occur when loan modification, short sale, or other agreement is being negotiated with the bank.
- The lender or the high bidder at the foreclosure sale can take possession of the property 20 days after the foreclosure sale.
Authored by David Monroe, Realtor and Pre-Foreclosure and Short Sale Specialist.
Access Seattle area short sale help and foreclosure resources including selling in foreclosure, and 8 Ways to Avoid or Stop Foreclosure.
Copyright (c) 2010 by David Monroe (Home4Investment Team at Keller Williams Seattle Metro West).