[WSBARP] Ownership of home post foreclosure auction
K. Garl Long
Garl at longlaw.biz
Thu Jun 23 13:06:53 PDT 2016
Attached unpublished opinion finds that the SOL ran despite the filing
and dismissal of a judicial foreclosure. Should a failed nonjudicial be
treated differently?
K. Garl Long
On 06/23/2016 12:30 PM, NC wrote:
> Could the owner have shown up and bid one dollar?
>
> On Thursday, June 23, 2016, Wendy Walter <WWalter at mccarthyholthus.com
> <mailto:WWalter at mccarthyholthus.com>> wrote:
>
> Jim,
>
> Here’s a relevant statute that discusses tolling events in the
> statute of limitations.
>
> *RCW 4.16.230*
>
> *Statute tolled by judicial proceedings.*
>
> When the commencement of an action is stayed by injunction or a
> statutory prohibition, the time of the continuance of the
> injunction or prohibition shall not be a part of the time limited
> for the commencement of the action.
>
> The foreclosure fairness act, now within RCW 61.24 et seq.
> prohibits a beneficiary from proceeding to foreclosure right away
> and instead requires certain due diligence, meet and confer and
> mediation steps to be taken in certain cases. I would argue that
> this is a statutory prohibition on commencement of an action and
> thus should not count against the beneficiary if the borrower were
> to challenge on the SOL defense.
>
> Furthermore, the CFPB servicing rules, contained in 12 CFR 1024.41
> similarly prohibit through federal rule the commencement of a
> foreclosure action by a beneficiary in certain circumstances.
> Before getting a borrower’s hopes up that the SOL might help them
> get out of their debt, consider the huge efforts that were made at
> a state and federal level to provide loss mitigation to so many
> borrowers in our state (and across the country). To come back and
> say that compliance with those efforts might prejudice the
> beneficiary from recovery on the debt, especially when the stakes
> are high and liability can be extreme for running the loss
> mitigation red lights put into effect is not likely to be
> supported by a court if you consider RCW 4.16.230.
>
> *Wendy Walter*|Partner - Pacific Northwest//| Member State Bars of
> WA and OR
>
> McCarthy ♦Holthus LLP
>
> m. 108 1^st Ave. S., Suite 300, Seattle, WA 98104
>
> d. 206.596.4844 | f. 206.780.6862 | c. 425.241.5459
>
> e. wwalter at mccarthyholthus.com
> <javascript:_e(%7B%7D,'cvml','wwalter at mccarthyholthus.com');>__
>
> Arizona ♦California ♦Colorado ♦ Idaho ♦Nevada ♦New Mexico ♦Oregon
> ♦Texas ♦Washington
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> *From:*wsbarp-bounces at lists.wsbarppt.com
> <javascript:_e(%7B%7D,'cvml','wsbarp-bounces at lists.wsbarppt.com');> [mailto:wsbarp-bounces at lists.wsbarppt.com
> <javascript:_e(%7B%7D,'cvml','wsbarp-bounces at lists.wsbarppt.com');>]
> *On Behalf Of *Jim Doran
> *Sent:* Thursday, June 23, 2016 11:04 AM
> *To:* WSBA Real Property Listserv
> *Subject:* Re: [WSBARP] Ownership of home post foreclosure auction
>
> Wendy:
>
> I am not clear in my own mind about how the foreclosure process
> tolls the statute of limitations. In general, how does that
> work? I am willing to learn. (I try not to but it happens anyway.)
>
> Jim
>
>
> James R. Doran
>
> Attorney at Law
>
> 100 E. Pine Street - Suite 205
>
> Bellingham, WA 98225
> (360)393-9506
>
> jim at doranlegal.com
> <javascript:_e(%7B%7D,'cvml','jim at doranlegal.com');>
>
> www.doranlegal.com <http://www.doranlegal.com>
>
> On Thu, Jun 23, 2016 at 10:12 AM, Wendy Walter
> <WWalter at mccarthyholthus.com
> <javascript:_e(%7B%7D,'cvml','WWalter at mccarthyholthus.com');>> wrote:
>
> But if the lender was statutorily barred from proceeding to
> foreclosure because of the pre-foreclosure diligence, meet and
> confer requirements, or the mediation program and the potential
> CFPB delays to proceeding to foreclosure due to the 120 day rule
> or the bar on dual tracking while reviewing a complete loss
> mitigation application the SOL defense might not apply.
>
> *Wendy Walter*|Partner - Pacific Northwest//| Member State Bars of
> WA and OR
>
> McCarthy ♦Holthus LLP
>
> m. 108 1^st Ave. S., Suite 300, Seattle, WA 98104
>
> d. 206.596.4844 <tel:206.596.4844> | f. 206.780.6862
> <tel:206.780.6862> | c. 425.241.5459 <tel:425.241.5459>
>
> e. wwalter at mccarthyholthus.com
> <javascript:_e(%7B%7D,'cvml','wwalter at mccarthyholthus.com');>
>
> Arizona ♦California ♦Colorado ♦ Idaho ♦Nevada ♦New Mexico ♦Oregon
> ♦Texas ♦Washington
>
> CONFIDENTIALITY NOTICE: The information contained herein may be
> privileged and protected by the attorney/client and/or other
> privilege. It is confidential in nature and intended for use by
> the intended addressee only. If you are not the intended
> recipient, you are hereby expressly prohibited from dissemination
> distribution, copy or any use whatsoever of this transmission and
> its contents. If you receive this transmission in error, please
> reply or call the sender and arrangements will be made to retrieve
> the originals from you at no charge.
>
> Federal law requires us to advise you that communication with our
> office could be interpreted as an attempt to collect a debt and
> that any information obtained will be used for that purpose.
>
> *From:*wsbarp-bounces at lists.wsbarppt.com
> <javascript:_e(%7B%7D,'cvml','wsbarp-bounces at lists.wsbarppt.com');> [mailto:wsbarp-bounces at lists.wsbarppt.com
> <javascript:_e(%7B%7D,'cvml','wsbarp-bounces at lists.wsbarppt.com');>]
> *On Behalf Of *Jim Doran
> *Sent:* Thursday, June 23, 2016 10:09 AM
> *To:* WSBA Real Property Listserv
> *Subject:* Re: [WSBARP] Ownership of home post foreclosure auction
>
> That's what I thought.
>
> Now, bring in the Statute of Limitations issue and the debt might
> be barred completely or at least partially. This depends on the
> time fromthe "acceleration" of the debt. but certainly some of
> the past due payments might have fallen off the debt.
>
> Jim Doran
>
>
> James R. Doran
>
> Attorney at Law
>
> 100 E. Pine Street - Suite 205
>
> Bellingham, WA 98225
> (360)393-9506 <tel:%28360%29393-9506>
>
> jim at doranlegal.com
> <javascript:_e(%7B%7D,'cvml','jim at doranlegal.com');>
>
> www.doranlegal.com <http://www.doranlegal.com>
>
> On Thu, Jun 23, 2016 at 9:48 AM, Kathryn R. McKinley
> <Kathryn.McKinley at painehamblen.com
> <javascript:_e(%7B%7D,'cvml','Kathryn.McKinley at painehamblen.com');>>
> wrote:
>
> The sale is only “final” if the Trustee accepts an offer and
> delivers the deed within 15 days. If that isn’t done, there is no
> sale and the Deed of Trust continues to encumber the property.
>
> *Kathryn R. McKinley*
>
> Partner
> PHEmailLogo
> 717 W. Sprague Ave. Suite 1200
> Spokane, WA 99201
> (509) 455-6000 <tel:%28509%29%20455-6000>
> kathryn.mckinley at painehamblen.com
> <javascript:_e(%7B%7D,'cvml','cindy.bryan at painehamblen.com');>
>
> *From:*wsbarp-bounces at lists.wsbarppt.com
> <javascript:_e(%7B%7D,'cvml','wsbarp-bounces at lists.wsbarppt.com');> [mailto:wsbarp-bounces at lists.wsbarppt.com
> <javascript:_e(%7B%7D,'cvml','wsbarp-bounces at lists.wsbarppt.com');>]
> *On Behalf Of *Paul Neumiller
> *Sent:* Thursday, June 23, 2016 9:29 AM
> *To:* 'WSBA Real Property Listserv'
> *Subject:* Re: [WSBARP] Ownership of home post foreclosure auction
>
> Whoa!?!?! I have never heard of this. Why would a bank do this??
> I would think that the foreclosure process WAS completed because
> an auction took place at the court house steps. It’s not the
> debtor’s fault the bank didn’t credit bid its loan at the sale.
> Why couldn’t the debtor now make the argument that the loan has
> been wiped out by the sale and there is no deficiency opportunity
> because the lender used a nonjudicial foreclosure? Is anyone else
> seeing this?
>
> *From:*wsbarp-bounces at lists.wsbarppt.com
> <javascript:_e(%7B%7D,'cvml','wsbarp-bounces at lists.wsbarppt.com');> [mailto:wsbarp-bounces at lists.wsbarppt.com
> <javascript:_e(%7B%7D,'cvml','wsbarp-bounces at lists.wsbarppt.com');>]
> *On Behalf Of *Jim Doran
> *Sent:* Thursday, June 23, 2016 8:06 AM
> *To:* attorney at shanapavithran.com
> <javascript:_e(%7B%7D,'cvml','attorney at shanapavithran.com');>;
> WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com
> <javascript:_e(%7B%7D,'cvml','wsbarp at lists.wsbarppt.com');>>
> *Subject:* Re: [WSBARP] Ownership of home post foreclosure auction.
>
> If the home was not "purchased" at the sale then the foreclosure
> was not completed. No deed from the Trustee was delivered to a
> new owner.
>
> This means that your client is still the owner of the property.
>
> There are a number of defenses that can be raised in a foreclosure
> process to keep the bank and servicer at bay. Now that the great
> recession of 2008 is getting years past the statute of limitations
> defense is looming and working its way through the courts of
> America. The entire debt or part of it might now be barred.
>
> anyway, if you client wants to talk to me a bout tis, or you want
> to, I am happy to do so. I have been doing "foreclosure defense"
> for a while now.
>
> Jim Doran
>
>
> James R. Doran
>
> Attorney at Law
>
> 100 E. Pine Street - Suite 205
>
> Bellingham, WA 98225
> (360)393-9506 <tel:%28360%29393-9506>
>
> jim at doranlegal.com
> <javascript:_e(%7B%7D,'cvml','jim at doranlegal.com');>
>
> www.doranlegal.com <http://www.doranlegal.com>
>
> On Thu, Jun 23, 2016 at 4:49 AM, <attorney at shanapavithran.com
> <javascript:_e(%7B%7D,'cvml','attorney at shanapavithran.com');>> wrote:
>
> I have a client, whose home was foreclosed, pursuant to a
> trust deed foreclosure. The lender held an auction on 2/5/16.
> The value of the mortgage was approximately 230K appraised
> current value is approximately 155K. Though foreclosed, home
> was not sold at the auction. The bank did not bid at the
> auction or transfer ownership of the home to the bank's name.
> The home remains in the client's name. He still pays the water
> bill on it. He does not live there right now. What rights
> does he have regarding the home? Does the bank own it or does
> the client own it outright, as the mortgage is discharged by
> the foreclosure.
>
> Shana Pavithran
> Attorney-at-Law
> Pavithran, PLLC.
> 22525 SE 64th Place, #279
> Issaquah, WA 98027
>
> Telephone: (425) 557-3625 <tel:%28425%29%20557-3625>
>
> Email: attorney at shanapavithran.com
> <javascript:_e(%7B%7D,'cvml','attorney at shanapavithran.com');>
> Website: www. shanapavithran.com <http://shanapavithran.com>
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> Nicholas L. Clapham
> (206)939-0262
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