Commentary on Washington State law and how it Relates to real Estate

How long does a homeowner have to remain in the home after a foreclosure sale takes place?

Posted on February 23, 2013 by Robert P. Dickson

A common question we get is how long after a foreclosure has taken place can the owner of the property expect to stay in the home? The answer can be found in the RCW:

The purchaser at the trustee’s sale shall be entitled to possession of the property on the twentieth day following the sale, as against the borrower and grantor under the deed of trust and anyone having an interest junior to the deed of trust, including occupants who are not tenants, who were given all of the notices to which they were entitled under this chapter. The purchaser shall also have a right to the summary proceedings to obtain possession of real property provided in chapter 59.12 RCW.

61.24.060. Rights and remedies of trustee’s sale purchaser–Written notice to occupants or tenants, WA ST 61.24.060
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After the 20 days have run, the party attempting to gain possession of the property must then follow the procedures contained in RCW 59.12. This statute covers the rules and procedures to evict someone from a property. If you include the statutory time it takes to execute the actual eviction, a property owner might expect to stay in the property for another several days. A smart strategy would be to negotiate a payment from the new owner of the property. Under the right circumstances, they may be willing to pay a modest relocation payment so as to avoid the hassle of having to try and push through the eviction procedures.

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Housing market in recovery? Yes, but signs show there will be a slow down in 2013

Posted on February 4, 2013 by Robert P. Dickson

Writing for Housing Wire, Megan Hopkins reports that the housing prices are likely to top out at modest increase in value:

Despite beginning the year with market lows, most home prices gained momentum toward the end up 2012, finishing the year at 4.9% year-over-year price gains. Some markets, though they are few, may also suffer a backslide in values.

According to the latest Clear Capital home data report, national home prices are expected to increase by only 2.1% this year. The 2013 yearly gains are expected to be smaller partly because homes are starting on a higher price base, but the entire explanation is more complex than that, Clear Capital notes.

While many western localities are seeing the firming up of housing prices, there are still several areas that could potentially see a shift down in pricing:

Only eight markets are projected to see prices fall in 2013, including Denver; Louisville, Ky.; Charlotte, N.C.; Philadelphia; Atlanta; Baltimore; Chicago and St. Louis. For those eight markets, average declines should come in at just 0.9%.

Thankfully, the Seattle area housing market continues to lead the charge in the beleaguered housing recovery:

Seattle, a market with a strong recovery already in the works, is expected to see the highest gains of the top 50 major metro markets at 13.5%.

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A word on the HAMP program

Posted on December 30, 2012 by Robert P. Dickson

Since the beginning of the recession in 2008, loan modification programs have been available primarily through the Home Affordable Mortgage Program (HAMP). If a homeowner was unable to quality, the individual mortgage company could offer its own programs.

Normally, the goal of a modification is a lower monthly payment through reduced interest rates, elongating the term of the loan, principal balance reduction, or a combination of all. Our firm has helped clients since the downturn’s beginning with modifications. We have seen a tremendous amount succeed through the lowered interest rates and/or lengthening the loan. Seldom, however, did lenders reduce principal balances. But now they are. Over several months, we have seen an uptick in this remedy, sometimes several thousand dollars or even tens of thousands in reduced balance. We have seen eliminations of entire second mortgage balances.

You may have heard of the settlement five banks reached with the federal government, called the New National Mortgage Settlement. In February 2012, the federal government and 49 states (Oklahoma did not participate) entered into a settlement with the country’s five largest loan lenders: Ally, Bank of America, Citi Bank, JPMorgan Chase, and Wells Fargo. In the settlement, $25 billion is set aside for mortgage relief to underwater homeowners, $17 billion of which for loan modifications and principal reductions.

As we watch the effect of this settlement unfold, we can only assume it will further benefit the homeowners who qualify though they must be borrowers of the settling banks or servicers. In a later Blog entry, focus on eligibility will be discussed.

–Contributed by Michael P. Dickson

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Foreclosure Fairness Act – Change of Timing for Submission of Mediation Request

Posted on December 30, 2012 by Robert P. Dickson

In June 7, 2012, the Foreclosure Fairness Act changed regarding when a mediation demand submission may be accepted. It states the following: (SHB 2614, Sec. 5)

A housing counselor or attorney assisting a borrower may refer the borrower tomediation, pursuant to RCW 61.24.163, if the housing counselor or attorney determines that mediation is appropriate based on the individual circumstances and the borrower has received a notice of default. The referral to mediation may be made any time after a notice of default has been issued but no later than twenty days after the date a notice of sale has been recorded.

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Podcast: Foreclosure Fairness Act – What is it, and how to take advantage of the mediation option

Posted on December 30, 2012 by Robert P. Dickson

 In this podcast, Rob Dickson describes how the new Foreclosure Fairness Act has impacted foreclosures in Washington. (Photo Credit: jscreationzs)

 

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Podcast: Washington State is a “non-recourse” loan state (kind of)

Posted on December 30, 2012 by Robert P. Dickson

In this podcast, Rob Dickson discusses the difference between non-recourse and recourse loans and how they effect foreclosures in Washington State.

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Beginning the Eviction (Unlawful Detainer) Process in Washington: Notice, Service of Process, and the Show Cause Hearing

Posted on December 30, 2012 by Robert P. Dickson

Washington has a very streamlined legal process for landlords to evict a tenant called an unlawful detainer action (assuming, of course, that the landlord is justified in doing so). RCW 59.12.030 defines unlawful detainer, and outlines many of the grounds for eviction. Because the unlawful detainer action simplifies and expedites the eviction process for the landlord, Washington has very specific statutory rules that landlords (and their attorneys) must follow in order for the eviction to be effective. Proper notice and proper service on the tenant are essential parts of an unlawful detainer action.

Notice

Before the landlord can begin the actual legal action against the tenant, notice must first be given to the tenant to vacate the premises for reasons stated in RCW 59.12.030. To do so, the landlord must follow one of three options outlined in RCW 59.12.040 by either (1) leaving a copy of such notice with the tenant personally, or (2) leaving a copy with a person at the residence and also sending a copy via mail to the residence, or (3) posting a copy in a conspicuous place at the residence, leaving a copy with anyone at the residence, and sending a copy via mail to the residence. As a practical matter, it would be wise to document each step in this process to prove compliance with this procedure, which is usually done by affidavit.

If the tenant does vacate the premises, the landlord can immediately take possession of the premises and, pursuant to RCW 59.18.310, can seek to recover from the tenant outstanding rent owed, if any. If the tenant left behind personal property at the premises, look here for a discussion on what the landlord may or must do.

Commencing the Action (Summons and Complaint)

If the tenant does not vacate the premises, an unlawful detainer legal action is required to effectively evict the tenant. To begin, just like in any other civil action, the landlord must file a summons and complaint (or, better yet, have an attorney do so). If rent is owed, the complaint should provide the amount. The summons must state, among other things, the timeframe within which the tenant must respond. See RCW 59.12.080; RCW 59.18.365. In other civil actions, the timeframe is typically 20 days, but because this action is more streamlined, RCW 59.12.070 allows a landlord to require response within as few as seven days (although no more than thirty days).

To properly serve the defendant with the summon and complaint, the same process is required for service as in other civil actions, see RCW 59.18.365, which generally requires personal service, or if the court allows, by publication.

Show Cause Hearing

Along with the summons and complaint, the landlord can also obtain from the court, and serve on the tenant, an order requiring the tenant to appear in court at a show cause hearing. See RCW 59.18.370. Conveniently, the timeframe for the tenant to appear at this hearing can be exactly the same as the timeframe as required for the tenant to respond to the summons and complaint (i.e., within as few as seven days, but no more than thirty days). What makes this hearing so useful for the landlord is that, at the hearing, the burden is on the tenant, rather than the landlord, to show cause (or prove) why the property should not be restored to the landlord. This hearing is the most expeditious way for the landlord to retake possession of the premises because, if the tenant cannot do so, or if the tenant fails to appear altogether, then the court will typically order the sheriff to restore property to the landlord. The court may also grant to the landlord other requests made in the complaint, such as payment of outstanding rent.

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