Washington Adds Provisions Regarding Lien Holder Requirements for Certain Foreclosures

On May 17, Washington enacted new legislation that would require a senior beneficiary of a deed of trust to respond to a seller’s written offer that the senior beneficiary accept the entire net proceeds of the sale when those proceeds are insufficient to pay the full obligation owed within 120 days. The statute applies only when the senior beneficiary receives the written offer from the seller prior to the issuance of a notice of default. The seller must include a copy of the purchase and sale agreement with the offer, and the senior beneficiary’s response must include either an acceptance, rejection, or counter-offer of the seller’s offer. The new requirements do not apply to deeds of trust securing a commercial loan, securing obligations of a grantor who is not the borrower or a guarantor, or securing a purchaser’s obligations under a seller-financed sale. The provisions take effect July 22.