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| The Deed of Trust Foreclosure Process in Washington |
There are three primary ways to foreclose on property in Washington,
although the term "foreclosure" has it's own meaning. A property can be
encumbered by a loan with a deed of trust, a real estate contract, or a
mortgage instrument of another kind.
Almost every transaction that involves a loan today will use the deed of
trust as security for the promissory note. If a note goes into default, the
deed of trust is foreclosed according to a very detailed procedure outlined
in state statutes. Unfortunately, that was not written by human beings, so it
is almost impossible to figure out what to do and when to do it. After years
of practicing real estate law, I developed a detailed foreclosure checklist,
which I include below for you.
Whether you are a lender and need to foreclose, an investor who holds a
note and deed of trust and needs to foreclose, or even an attorney who
needs a good checklist, this checklist will show you exactly what is involved
in the legal process of foreclosure and taking back a property. Of course,
what you really do is have a public Trustee's Sale, but if no one bids above
the about of the loan plus costs and fees, you get it back, and can then
resell it.
For those who hold a real estate contract as opposed to the deed of trust, I
include my Checklist for that process, too, which is not called foreclosure,
but is called forfeiture.
Foreclosure of a deed of trust on residential property does NOT allow a
deficiency judgment. In that case you would want to foreclose as a
mortgage.
although the term "foreclosure" has it's own meaning. A property can be
encumbered by a loan with a deed of trust, a real estate contract, or a
mortgage instrument of another kind.
Almost every transaction that involves a loan today will use the deed of
trust as security for the promissory note. If a note goes into default, the
deed of trust is foreclosed according to a very detailed procedure outlined
in state statutes. Unfortunately, that was not written by human beings, so it
is almost impossible to figure out what to do and when to do it. After years
of practicing real estate law, I developed a detailed foreclosure checklist,
which I include below for you.
Whether you are a lender and need to foreclose, an investor who holds a
note and deed of trust and needs to foreclose, or even an attorney who
needs a good checklist, this checklist will show you exactly what is involved
in the legal process of foreclosure and taking back a property. Of course,
what you really do is have a public Trustee's Sale, but if no one bids above
the about of the loan plus costs and fees, you get it back, and can then
resell it.
For those who hold a real estate contract as opposed to the deed of trust, I
include my Checklist for that process, too, which is not called foreclosure,
but is called forfeiture.
Foreclosure of a deed of trust on residential property does NOT allow a
deficiency judgment. In that case you would want to foreclose as a
mortgage.
This list should come in useful if you have anything to do with foreclosures.
Remember, if you are using this list, you are responsible for updating the
checklist for any changes in the law.
Remember, if you are using this list, you are responsible for updating the
checklist for any changes in the law.
| Did you know that you can often get a reduction in the total costs and fees to reinstate a deed of trust to avoid foreclosure? The attorney's fees can usually be discounted by agreement with that attorney, because he hasn't done all the work although the fee represents the full legal fee. |
These are the kinds of costs and fees involved with a typical foreclosure, and
some of these can be reduced or discounted when you reinstate:
Currently due Estimated amount
to reinstate that will be due
on 7/23/2001 to reinstate on
(Today’s date) 10/15/2001
(11 days before the
date set for sale)
Part I. Payments, Charges, & Fees:
Payment due 2/26/2001 287.00 287.00
Payment due 3/26/2001 287.00 287.00
Payment due 4/26/2001 287.00 287.00
Payment due 5/26/2001 287.00 287.00
Payment due 6/26/2001 287.00 287.00
Payment due 7/26/2001 00.00 287.00
Payment due 8/26/2001 00.00 287.00
Payment due 9/26/2001 00.00 287.00
Late charges ($14.35/mo) 71.75 114.80
Reserve Account Shortage 00.00 00.00
Advances 00.00 00.00
Attorney's Fees 1,800.00 2,200.00
Trustee's Fees 200.00 200.00
SUBTOTAL $ 3,506.25 $ 4,810.80
Part II. Trustee's expenses: (Estimated)
a. Title report 296.73 296.73
b. Recording fees 30.00 30.00
c. Service/Posting of
Notices 60.00 60.00
d. Postage/copying expense 40.00 40.00
e. Inspection (and
appraisal) fees 0.00 0.00
f. Long distance
telephone charges 15.00 15.00
g. Publication of
notice of sale 0.00 400.00
Subtotal $ 441.73 $ 841.73
Part I & Part II SUBTOTAL $ 3,947.98 $ 5,652.53
some of these can be reduced or discounted when you reinstate:
Currently due Estimated amount
to reinstate that will be due
on 7/23/2001 to reinstate on
(Today’s date) 10/15/2001
(11 days before the
date set for sale)
Part I. Payments, Charges, & Fees:
Payment due 2/26/2001 287.00 287.00
Payment due 3/26/2001 287.00 287.00
Payment due 4/26/2001 287.00 287.00
Payment due 5/26/2001 287.00 287.00
Payment due 6/26/2001 287.00 287.00
Payment due 7/26/2001 00.00 287.00
Payment due 8/26/2001 00.00 287.00
Payment due 9/26/2001 00.00 287.00
Late charges ($14.35/mo) 71.75 114.80
Reserve Account Shortage 00.00 00.00
Advances 00.00 00.00
Attorney's Fees 1,800.00 2,200.00
Trustee's Fees 200.00 200.00
SUBTOTAL $ 3,506.25 $ 4,810.80
Part II. Trustee's expenses: (Estimated)
a. Title report 296.73 296.73
b. Recording fees 30.00 30.00
c. Service/Posting of
Notices 60.00 60.00
d. Postage/copying expense 40.00 40.00
e. Inspection (and
appraisal) fees 0.00 0.00
f. Long distance
telephone charges 15.00 15.00
g. Publication of
notice of sale 0.00 400.00
Subtotal $ 441.73 $ 841.73
Part I & Part II SUBTOTAL $ 3,947.98 $ 5,652.53
| Sequim Real Estate & Port Angeles Real Estate |