2421-S AMS KLIN S5040.1

SHB 2421  - S AMD150
     By Senator Kline

     On page 36, after line 10, insert the following:

"Sec. 10   RCW 61.24.010 and 2009 c 292 s 7 are each amended to read as follows:
     (1) The trustee of a deed of trust under this chapter shall be:
     (a) Any domestic corporation or domestic limited liability corporation incorporated under Title 23B, 25, 30, 31, 32, or 33 RCW of which at least one officer is a Washington resident; or
     (b) Any title insurance company authorized to insure title to real property under the laws of this state, or any title insurance agent licensed under chapter 48.17 RCW; or
     (c) Any attorney who is an active member of the Washington state bar association at the time the attorney is named trustee; or
     (d) Any professional corporation incorporated under chapter 18.100 RCW, any professional limited liability company formed under chapter 25.15 RCW, any general partnership, including limited liability partnerships, formed under chapter 25.04 RCW, all of whose shareholders, members, or partners, respectively, are either licensed attorneys or entities, provided all of the owners of those entities are licensed attorneys, or any domestic corporation wholly owned by any of the entities under this subsection (1)(d); or
     (e) Any agency or instrumentality of the United States government; or
     (f) Any national bank, savings bank, or savings and loan association chartered under the laws of the United States.
     (2) The trustee may resign at its own election or be replaced by the beneficiary. The trustee shall give prompt written notice of its resignation to the beneficiary. The resignation of the trustee shall become effective upon the recording of the notice of resignation in each county in which the deed of trust is recorded. If a trustee is not appointed in the deed of trust, or upon the resignation, incapacity, disability, absence, or death of the trustee, or the election of the beneficiary to replace the trustee, the beneficiary shall appoint a trustee or a successor trustee. Only upon recording the appointment of a successor trustee in each county in which the deed of trust is recorded, the successor trustee shall be vested with all powers of an original trustee.
     (3) The trustee or successor trustee shall have no fiduciary duty or fiduciary obligation to the grantor or other persons having an interest in the property subject to the deed of trust.
     (4) The trustee or successor trustee has a duty of good faith to the borrower, beneficiary, and grantor.

Sec. 11   RCW 61.24.050 and 1998 c 295 s 7 are each amended to read as follows:
     ((When delivered)) (1) Upon physical delivery of the trustee's deed to the purchaser, or a different grantee as designated by the purchaser following the trustee's sale, the trustee's deed shall convey all of the right, title, and interest in the real and personal property sold at the trustee's sale which the grantor had or had the power to convey at the time of the execution of the deed of trust, and such as the grantor may have thereafter acquired. Except as provided in subsection (2) of this section, if the trustee accepts a bid, then the trustee's sale is final as of the date and time of such acceptance if the trustee's deed is recorded within fifteen days thereafter. After a trustee's sale, no person shall have any right, by statute or otherwise, to redeem the property sold at the trustee's sale.
     (2)(a) Up to the eleventh day following the trustee's sale, the trustee, beneficiary, or authorized agent for the beneficiary may declare the trustee's sale and trustee's deed void for the following reasons:
     (i) The trustee, beneficiary, or authorized agent for the beneficiary assert that there was an error with the trustee foreclosure sale process including, but not limited to, an erroneous opening bid amount made by or on behalf of the foreclosing beneficiary at the trustee's sale;
     (ii) The borrower and beneficiary, or authorized agent for the beneficiary, had agreed prior to the trustee's sale to a loan modification agreement, forbearance plan, shared appreciation mortgage, or other loss mitigation agreement to postpone or discontinue the trustee's sale; or
     (iii) The beneficiary or authorized agent for the beneficiary had accepted funds that fully reinstated or satisfied the loan even if the beneficiary or authorized agent for the beneficiary had no legal duty to do so.
     (b) This subsection does not impose a duty upon the trustee any different than the obligations set forth under RCW 61.24.010 (3) and (4).
     (3) The trustee must refund the bid amount to the purchaser no later than the third day following the postmarked mailing of the rescission notice described under subsection (4) of this section.
     (4) No later than fifteen days following the voided trustee's sale date, the trustee shall send a notice in substantially the following form by first-class mail and certified mail, return receipt requested, to all parties entitled to notice under RCW 61.24.040(l) (b) through (e):



     NOTICE OF RESCISSION OF TRUSTEE'S SALE



     NOTICE IS HEREBY GIVEN that the trustee's sale that occurred on (trustee's sale date) is rescinded and declared void because (insert the applicable reason(s) permitted under RCW 61.24.050(2)(a)).
     The trustee's sale occurred pursuant to that certain Notice of Trustee's Sale dated . . . ., . . ., recorded . . . ., . . ., under Auditor's File No. . . ., records of . . . . County, Washington, and that certain Deed of Trust dated . . . ., . . ., recorded . . . ., . . ., under Auditor's File No. . . ., records of . . . . County, Washington, from . . . ., as Grantor, to . . . ., as . . . ., as original Beneficiary, concerning the following described property, situated in the County(ies) of . . . ., State of Washington, to wit:



     (Legal description)



Commonly known as (common property address)


     (5) If the reason for the rescission stems from subsection (2)(a) (i) or (ii) of this section, the trustee may set a new sale date not less than forty-five days following the mailing of the notice of rescission of trustee's sale. The trustee shall:
     (a) Comply with the requirements of RCW 61.24.040(1) (a) through (f) at least thirty days before the new sale date; and
     (b) Cause a copy of the notice of trustee's sale as provided in RCW 61.24.040(1)(f) to be published in a legal newspaper in each county in which the property or any part of the property is situated, once between the thirty-fifth and twenty-eighth day before the sale and once between the fourteenth and seventh day before the sale.
"

     Renumber the remaining section consecutively and correct any internal references accordingly.

SHB 2421  - S AMD
     By Senator Kline

     On page 1, line 3 of the title, after "61.24.040," strike "and 61.24.172" and insert "61.24.172, 61.24.010, and 61.24.050"

EFFECT:  (1) A domestic limited liability corporation incorporated under specific statutes may be a trustee under the Deeds of Trust Act.
     (2) Up to 11 days following the trustee's sale, the trustee, beneficiary, or authorized agent for the beneficiary may declare the trustee's sale and trustee's deed void for the following reasons:
     (a) The trustee, beneficiary, or authorized agent for the beneficiary asserts there was an error with the trustee foreclosure sale process including, but not limited to, an erroneous opening bid amount made by or on behalf of the foreclosing beneficiary at the trustee's sale;
     (b) Prior to the sale, there was an agreement for a loan modification, forbearance plan, or other loss mitigation agreement to postpone or discontinue the trustee's sale; or
     (c) The beneficiary or authorized agent accepted funds that fully reinstated or satisfied the loan even if the beneficiary or authorized agent had no legal duty to do so.
     (3) The trustee is to refund the bid amount to the purchaser.
     (4) No later than 15 days following the voided trustee's sale, the trustee is to send a notice, as proscribed by statute, to all parties entitled to the notice.
     (5) If the rescission is based on an erroneous bid amount or an agreement to postpone the sale, the trustee may set a new sale date at least 45 days following the mailing of the notice of rescission of the trustee's sale.
     (6) The trustee is to: Comply with the requirements for holding a trustee's sale at least 30 days before the new sale date; and publish the Notice of Trustee's Sale as required by statute.

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