S-4468               _______________________________________________

                                         SUBSTITUTE SENATE BILL NO. 5500

                        _______________________________________________

State of Washington                              50th Legislature                              1988 Regular Session

By Senate Committee on Law & Justice (originally sponsored by Senators Talmadge, Hayner, Lee and Rasmussen)

Read first time 1/27/88.

AN ACT Relating to the fixing of fair value for homestead or agricultural property for foreclosure; and amending RCW 61.12.060.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

        Sec. 1.  Section 410, page 207, Laws of 1854 as last amended by section 1, chapter 125, Laws of 1935 and RCW 61.12.060 are each amended to read as  follows:

          In rendering judgment of foreclosure, the court shall order the mortgaged premises, or so much thereof as may be necessary, to be sold to satisfy the mortgage and costs of the action.  The payment of the mortgage debt, with interest and costs, at any time before sale, shall satisfy the judgment.  ((The court, in ordering the sale, may in its discretion, take judicial notice of economic conditions, and after a proper hearing, fix a minimum or upset price to which the mortgaged premises must be bid or sold before confirmation of the sale.))

If the property that is to be sold is subject to a homestead exemption under chapter 6.12 RCW or is used principally for agricultural or farming purposes, the court may, upon application for the confirmation of a sale, ((if it has not theretofore fixed an upset price,)) conduct a hearing, establish the value of the property, and, as a condition to confirmation, require that the fair value of the property be credited upon the foreclosure judgment.  ((If an upset price has been established, the plaintiff may be required to credit this amount upon the judgment as a condition to confirmation.))  If the fair value as found by the court, when applied to the mortgage debt, discharges it, no deficiency judgment shall be granted.