[WSBARP] DOT and Non-monetary Defaults

[Eric Nelsen]

Please reply to list--I haven't done this myself, but I think it's possible to give a notice of default and demand cure, especially if the deferred maintenance is approaching statutory waste in its magnitude. If the lender has evidence that the value of the property is being significantly impaired as collateral, I think that would show sufficient prejudice to allow foreclosure before it gets any worse. And doing it by nonjudicial procedure would probably be efficient, since it puts the burden on the borrower to try to halt the proceeding.

Sincerely,

Eric

Eric C. Nelsen
SAYRE LAW OFFICES, PLLC
1320 University St
Seattle WA 98101-2837
phone 206-625-0092
fax 206-625-9040

From: wsbarp-bounces at lists.wsbarppt.com [mailto:wsbarp-bounces at lists.wsbarppt.com] On Behalf Of Paul Neumiller
Sent: Wednesday, February 03, 2016 1:53 PM
To: wsbarp at lists.wsbarppt.com
Subject: [WSBARP] DOT and Non-monetary Defaults

Listmates: I have been pondering this problem for a long time.  Client is a seller-carryback holder of a deed of trust and note.  Debtor is not in default of note installments but is allowing the real property secured by the lien of the DOT to deteriorate.  Waaaay too much deferred maintenance (i.e. leaking roof in residence, dilapidated barns, etc.).  The note doesn't mature for another 20 years.  Parties used the standard WA residential DOT requiring that debtor "keep the property in good condition and repair"  and an acceleration of debt if the debtor fails to perform a duty agreed to in the DOT.

So how does this work?  Has anyone just tried a non-judicial foreclosure and "damn the torpedoes"?  Maybe, have the creditor go in and fix everything (not sure the creditor has the right to cure non-monetary defaults) and then bring a non-judicial foreclosure based on the repair costs, OR bring a judicial foreclosure and have lots of pictures and evidence of deferred maintenance?  That sure seems like a can of worms and litigator's dream.  Any ideas?

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