BILL REQ. #:  H-4959.1 

READ FIRST TIME 02/03/10.   

     AN ACT Relating to the foreclosure of residential real property; creating a new section; and providing an expiration date.

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

NEW SECTION.  Sec. 1   (1) In an effort to reduce the number of residential foreclosures while protecting the interests of both borrowers and beneficiaries, the department of financial institutions shall:
     (a) Conduct a review of the effectiveness of RCW 61.24.031, which requires a beneficiary or authorized agent to contact the borrower before issuing a notice of default for the purposes of assessing the borrower's financial ability to repay the debt and discussing alternatives to foreclosure. The department's review of the process shall, at a minimum, examine whether the contact requirement has resulted in an increase in the number of loan modifications and whether additional statutory provisions, such as mandatory mediation, are needed to produce effective communication between beneficiaries and borrowers;
     (b) Evaluate the feasibility of a temporary foreclosure forbearance program for borrowers who have been consistent in their payments but due to recent unemployment face possible foreclosure and for borrowers who face possible foreclosure based on property tax liens;
     (c) Review whether borrowers have brought court claims to enjoin foreclosures based on changes enacted in 2009 to the foreclosure process, and review the outcomes of those cases; and
     (d) Identify additional sources of funds for mortgage assistance.
     (2) The department of financial institutions shall report its findings and any recommendations for legislation to the appropriate committees of the legislature by November 30, 2010.
     (3) This section expires January 1, 2011.