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Washington Court of Appeals Confirms Lenders’ Right to Obtain Deficiency Judgments Against Guarantors Following Nonjudicial Foreclosure of Commonly Used Form of Deed of Trust

by Lane Powell PC - Seattle Office

March 11, 2014

Previously published on February 28, 2014

The Deed of Trust Act generally bars a lender from seeking a deficiency judgment against a borrower following nonjudicial foreclosure of a deed of trust securing the borrower's loan. The Act contains some exceptions in the case of a commercial loan and i t expressly permits a lender to seek a deficiency judgment against a guarantor of a foreclosed loan, subject to the guarantor's right to challenge the fair value paid for the property at the trustee's sale. RCW 61.24.100(3)(c), (5). In Washington Federal v. Gentry, --- P.3d ---, 2014 WL 627817 (Wash. App. Feb. 18, 2014), a case argued by Lane Powell, Division One of the Washing ton State Court of Appeals held that the lender's right to seek a deficiency judgment against a guarantor exists even where the foreclosed deed of trust secures both the borrower's loan and the guarantor's guaranty.


The views expressed in this document are solely the views of the author and not Martindale-Hubbell. This document is intended for informational purposes only and is not legal advice or a substitute for consultation with a licensed legal professional in a particular case or circumstance.

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Lane Powell PC
Seattle Office
Practice Area
Real Estate
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