SENATE BILL REPORT

SHB 1329

BYHouse Committee on Judiciary (originally sponsored by Representatives Crane, Brough, Sutherland, Lewis, Heavey, Padden, Nutley, Peery and Hargrove)

Changing provisions relating to the homestead exemption.

House Committe on Judiciary

Senate Committee on Law & Justice

Senate Hearing Date(s):February 25, 1988

Majority Report:  Do pass.

      Signed by Senators McCaslin, Vice Chairman; Halsan, Madsen, Niemi, Talmadge.

Senate Staff:Lidia Mori (786-7418)

                  February 26, 1988

AS REPORTED BY COMMITTEE ON LAW & JUSTICE, FEBRUARY 25, 1988

BACKGROUND:

The Homestead Act protects a homestead from attachment and from forced sale for the debts of the owner up to $30,000 or the total net value of the lands, mobile home, and improvements, whichever is less.  There are four exceptions to this protection:  mechanic's and materialmen's liens; mortgages or deeds of trust; certain debts arising out of a bankruptcy filed by one spouse within six months of the other spouse's bankruptcy; and child support debts.

People who purchase a condominium or home and belong to a condominium or homeowners association generally purchase the property subject to an agreement to pay assessments to the association.  Typically, these assessments are for maintenance work.  There have been instances where an association member has become delinquent in paying the assessments and the association is unable to exercise the option of foreclosure due to the protection affordable by the Homestead Act.

SUMMARY:

Liens for unpaid homeowners association assessments are excluded from the protection of the Homestead Act.

Notice that nonpayment of the association fees may result in foreclosure of the real property of the owner must be given by the association within 30 days of the association acquiring actual knowledge of a new owner.  In all cases, the notice must be given prior to the start of a foreclosure action.  The notice must state that the homestead protection does not apply.  An association does not have a duty to seek out and find new owners.  Failure to give proper notice affects an association's lien for debts accrued up to the time the association does comply with the notice requirements.

Appropriation:    none

Revenue:    none

Fiscal Note:      none requested

Senate Committee - Testified: Barbara Peterson; Bill Wilson; Stacey Marriott