Foreclosure Fairness Program Report to the Legislature — Washington State Department of Commerce
Summary
The Washington State Department of Commerce's Foreclosure Fairness Program annual report to the Legislature, dated July 2026 and made under RCW 61.24.163, covering state fiscal year 2025 (July 1, 2024, to June 30, 2025). It maps each reporting requirement of RCW 61.24.163(18), including referrals to mediation by housing counselors or attorneys, mediation results, certifications of good faith and loans restructured or modified, to the report's tables. The report states that data on changes in borrowers' monthly principal and interest payments are in private documents not available to Commerce and are not included. It notes that under Chapter 393, Laws of 2025, reporting from SFY 2026 expands to mediation for unit owners and associations, and its recommendations include a fee payment structure under RCW 61.24.157(1) that promotes bulk payments.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
- Issuer
- Congressional materials
- Document type
- Report
- Case
- 2026 Fy25 Ffa Leg Report Final 95Db7E27 5056 4E13 B04A 53F8282Acfec
Cite this document
“Foreclosure Fairness Program Report to the Legislature — Washington State Department of Commerce.”
Original at app.leg.wa.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2026-fy25-ffa-leg-report-final-95db7e27-5056-4e13-b04a-53f8282acfec/
, SHA-256 c2d81c911392d706c8b114fdebac92229005f19a19b47de04a10ef49b7d339e4.Full text
Foreclosure Fairness Program
Annual report on program performance per RCW 61.24.163
July 2026
Report to the Legislature
FORECLOSURE FAIRNESS PROGRAM
HOMEOWNERSHIP UNIT Interim Director Sarah Clifthorne
v4
Acknowledgments
Washington State Department of Commerce
Tedd Kelleher, Interim Assistant Director, Housing
Division
Ann Campbell, Managing Director, Homeownership
Unit
Kay Murano, Assistant Managing Director,
Homeownership Unit
Lisa Sohni, Homeownership Support Programs
Manager
Kyle Jung, Program Manager, Foreclosure Fairness
Program
Jazmin Calmer, Program Specialist, Foreclosure
Fairness Program
April Ketcherside, Program Specialist, Foreclosure
Fairness Program
Washington State Housing Finance Commission
Steve Walker, Executive Director
Washington State Office of the Attorney General
Nick Brown, Attorney General
Office of Civil Legal Aid
Sara Robbins, Director
Special thanks to the Dispute Resolution Centers, the
Washington Homeownership Resource Center,
Northwest Justice Project, mediators, attorneys and
housing counselors who collaborated with the
Department of Commerce to implement and deliver
the Foreclosure Fairness Program.
1011 Plum St. SE
P.O. Box 42525
Olympia, WA 98504-2525
www.commerce.wa.gov
For people with disabilities, this report is available on
request in other formats. Please call 360-725-4000 with
your request.
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 2
Table of contents
Executive summary .............................................................................................................................................4
Introduction ........................................................................................................................................................6
Program outcomes ........................................................................................................................................... 11
Foreclosure updates and information ................................................................................................................ 23
Legislative updates and changes ....................................................................................................................... 24
Recommendations ............................................................................................................................................ 29
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 3
Executive summary
Overview
This report provides the Washington State Department of Commerce's (Commerce) Foreclosure Fairness Program
(FPP) data for state fiscal year (SFY) 2025 (July 1, 2024, to June 30, 2025). Table 1 maps the location of the
required reporting elements in this report. The legislative reporting requirement (RCW 61.24.163(18)) is below:
Beginning December 1, 2012, and every year thereafter, the department shall report annually to the Legislature on:
(a) The performance of the program, including the numbers of borrowers who are referred to mediation by a housing
counselor or attorney;
(b) The results of the mediation program, including the number of mediations requested by housing counselors and
attorneys, the number of certifications of good faith issued, the number of borrowers and beneficiaries who failed to
mediate in good faith, and the reasons for the failure to mediate in good faith, if known, the numbers of loans restructured
or modified, the change in the borrower's monthly payment for principal and interest and the number of principal write-
downs and interest rate reductions, and, to the extent practical, the number of borrowers who report a default within a
year of restructuring or modification;
(c) The information received by housing counselors regarding outcomes of foreclosures; and
(d) Any recommendations for changes to the statutes regarding the mediation program.
As of Jan. 1, 2026, the programmatic reporting requirements are outlined in RCW 61.24.163(22).
Table 1 shows where each of the annual reporting requirements described in RCW 61.24.163(18) appears in this
report. It helps readers quickly find the sections that explain what must be reported each year under the law.
Table 1: Annual reporting requirements for this report
Subsection Statutory language Location
"The performance of the program, including the numbers of borrowers who are
(a) Table 2
referred to mediation by a housing counselor or attorney."
"The results of the mediation program, including the number of mediations requested
(b) Table 3, Table 5, Table 6 and Table 7
by housing counselors and attorneys."
"The number of certifications of good faith issued, the number of borrowers and
(b) beneficiaries who failed to mediate in good faith, and the reasons for the failure to Table 5, Table 6, Table 7 and Table 8
mediate in good faith, if known, the numbers of loans restructured or modified."
"The change in the borrower's monthly payment for principal and interest, and the
(b) Table 5
number of principal write-downs and interest rate reductions."1
Commerce conducted a survey in
"To the extent practical, the number of borrowers who report a default within a year
(b) 2014, which determined that this
of restructuring or modification."
information is unavailable.2
"The information received by housing counselors regarding outcomes of
(c) Table 3 and Table 4
foreclosures."
"Any recommendations for changes to the statutes regarding the mediation
(d) Recommendations
program."
1 RCW 61.24.163(18)(b) requires Commerce report on "the change in the borrower's monthly payment for principal and interest." This data is
contained in private documents that are not available to Commerce and is therefore not included in this report.
2 The results of the survey can be found within the 2014 Foreclosure Fairness Program Annual Report beginning on page 25.
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 4
A note about the SFY 2026 annual report
Pursuant to Chapter 393, Laws of 2025, beginning with the SFY 2026, the Foreclosure Fairness Program Annual
Report (December 2026) has expanded its reporting criteria to include information on foreclosure mediation
outcomes for referrals made in association with foreclosures.
As of Jan. 1, 2026, under RCW 61.24.163(22), the new reporting requirements include the following:
The number of unit owners who are referred to mediation by a housing counselor or attorney.
The number of unit owners and associations who failed to mediate in good faith, and the reasons for the failure
to mediate in good faith, if known, the number of debts for delinquent assessments restructured or modified, the
change in the unit owner's periodic assessment payments including any reductions in late charges or interest
rates, and, to the extent practical, the number of unit owners who report a delinquency within a year of
restructuring or modification.
More information about these changes is in the "Legislative updates and changes" section of this report.
Key findings:
The passage of Chapter 393, Laws of 2025, expands the Foreclosure Fairness Program and creates an
additional revenue source for program funding.
The new funding allocation structure will better serve the needs of the entities who receive program
funds and the recipients of their respective services.
The expansion of the Foreclosure Fairness Act to incorporate association foreclosures into the
foreclosure mediation program will allow the program to effectively serve more distressed homeowners.
The Foreclosure Fairness Program provides an essential safety net relied upon by Washington
residents facing distressing homeownership situations. See the "Program outcomes" section of this
report.
Recommendations and conclusions
Complex and large changes to statute, as seen with the passage of Chapter 393, Laws of 2025, typically require
additional changes and updates as unforeseen complications arise during the initial implementation. As
Commerce and our programmatic partners continue to implement the full extent of the legislation passed during
the 2025 legislative session, detailed recommendations may be outlined and included in future reports as informed
by data and programmatic observations from our partners and us. See the "Recommendations" section of this
report for further explanation and analysis.
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 5
Introduction
Background
The Foreclosure Fairness Program (FFP) was created in 2011 in response to the significant number of foreclosures
resulting from the Great Recession. The program allows borrowers facing foreclosure to find alternatives by
demanding mediation with their lenders (beneficiaries) to look for alternatives to foreclosure. In 2013, the second
full year of the program's operation, there were more than 37,000 3 foreclosures statewide, and the mediation
program received more than 2,500 referrals. 4 As the state recovered from the recession, foreclosures and referrals
declined steadily.
The success of the FFP is directly related to the relationships established with all partners involved. The primary
stakeholders include homeowner advocates, the banking industry, trustees, mediators, housing counselors,
attorneys and the state program partners identified in this report.
Overall, the creation of the FFP was intended to:
Reshape the non-judicial foreclosure 5 process in Washington to help protect homeowners from avoidable
foreclosures
Ensure the process is fair and transparent, even when foreclosure is unavoidable, and allow both borrowers and
beneficiaries to meet and make well-informed decisions
As described in the "Legislative updates and changes" section of this report, the Foreclosure Fairness Program has
been expanded to include additional foreclosure protections for homeowners experiencing a foreclosure initiated
by their respective common interest community. 6 Our network and programmatic relationships have expanded to
include association organizations and their respective advocates.
Negative effects of foreclosure
Losing a home has many adverse effects, primarily financial. For many middle and low-income households, their
homes are their largest assets. Homeownership has long been viewed as a sound investment opportunity to fund
retirement, provide for a dependent's education and ensure general financial stability. 7
The assets a family loses due to foreclosure can reverberate across several generations through lost inheritances. 8
A foreclosure will result in a significant loss of points on a borrower's credit report. 9 That effect lasts for up to
seven years, during which the borrower has limited access to affordable credit. Tax implications can also arise if
the Internal Revenue Service (IRS) treats forgiven debt as income.
Benefits of mediation
Mediation yields many benefits to beneficiaries and homeowners. Both parties benefit from a structured, organized
mediation process that provides an opportunity to engage in a facilitated discussion of alternatives to foreclosure.
For the borrower, a loan modification might result in the reduction of their mortgage principal, an interest rate
3 From unpublished data provided by Zillow.
4 From the Commerce Foreclosure Fairness Program Database (FFPD).
5 Washington is a "non-judicial foreclosure" state, meaning that a lender can opt to foreclose on a property through a third party, the trustee,
and not through the court system: Washington State Foreclosure Fairness Program.
6 Common interest communities are commonly known as "associations," including homeowners' or condominium owners' associations.
7 Federal Reserve Bank of New York, "SCE Housing Survey" (2019). SCE Housing Survey - FEDERAL RESERVE BANK of NEW YORK.
8 Saegert et al, Mortgage Foreclosure and Health Disparities: Serial Displacement as Asset Extraction in African American Populations - PMC
(nih.gov), Journal of Urban Health: Bulletin of the New York Academy of Medicine, Vol. 88, No. 3, (2011)
9 Experian, "Understanding Foreclosure," (2020)
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 6
reduction and lower, more affordable monthly payments. For the beneficiary, achieving agreements and creative
solutions in mediation to avoid foreclosure often saves the lender substantial legal fees if the foreclosure process
continues for the involved property.
However, not all successful mediations result in the borrower keeping the home. When a family's income or other
circumstances make it impossible to keep the home, a non-retention agreement can give a borrower more time to
leave or sell on their terms. Non-retention agreements can also help preserve or improve a borrower's financial
stability.
Agency partner roles and responsibilities
The Foreclosure Fairness Act (FFA) gives Commerce the primary responsibility for developing and managing the
FFP.
The agency collaborates with the following entities to perform the work:
Washington State Housing Finance Commission
Office of the Attorney General
Office of Civil Legal Aid
Department of Financial Institutions
Washington Homeownership Resource Center
The FFP also partners with:
Northwest Justice Project
Dispute Resolution Centers 10
Mediators
Attorneys (private and civil legal aid)
Housing counselors
Washington State Housing Finance Commission
The Washington State Housing Finance Commission (WSHFC) administers a homeowner counseling program, as
required by the Foreclosure Fairness Act. Much of the FFP funds directed to the WSHFC support free-to-consumers
foreclosure-related housing counseling services throughout the state, including:
Information and referrals
Preparation for and representation at meet-and-confer sessions
Preparation for and representation at mediation
Homeowner education and participation in community projects benefiting homeowners
Office of Civil Legal Aid
The Office of Civil Legal Aid (OCLA) contracts with qualified legal aid programs to provide no-cost legal assistance
to low- and moderate-income homeowners in matters related to foreclosure. Commerce collaborates with OCLA to
provide this assistance. OCLA currently grants all the Foreclosure Fairness Act funds it receives to Northwest
Justice Project, which provides statewide support for this work. 11
Northwest Justice Project
Northwest Justice Project (NJP) provides housing counseling services and no-cost legal services to low- and
moderate-income homeowners facing foreclosure. These legal services include representation in defense of all
10 Dispute Resolution Centers provide affordable mediation to resolve several types of disputes: https://www.resolutionwa.org/.
11 Data representing NJP's housing counselor services is included in data provided by the WSHFC.
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 7
forms of foreclosure, including mortgage, property tax, utility lien, court-ordered forced sale and
homeowner/community association matters.
Borrowers in danger of losing their homes often need help addressing civil legal issues in addition to foreclosure.
NJP’s advocates address other consumer needs in certain instances to achieve greater economic security. That
might mean challenging or negotiating other debts and liabilities or helping the homeowner apply for property tax
relief to reduce monthly expenses. The advocates refer homeowners to other resources or community partners
when issues fall outside their expertise.
Washington Homeownership Resource Center
The Homeownership Resource Hotline (1-877-894-HOME (4663)) is administered by the Washington
Homeownership Resource Center (WHRC). By law, banks and loan servicers are required to supply the hotline
phone number to all homeowners who are late on a payment or facing default on their mortgage. WHRC is the
primary entry point for homeowners facing foreclosure and in need of information and referrals to housing
counseling services and civil legal aid assistance.
Office of the Attorney General
The Office of the Attorney General's (AGO) Consumer Protection Division created the Foreclosure Compliance
Program to enforce the Deed of Trust Act (chapter 61.24 RCW) and investigate complaints related to foreclosure.
Department of Financial Institutions
The Department of Financial Institutions (DFI) licenses some of the beneficiaries that are participating in
foreclosure mediation in Washington. DFI reviews the “Beneficiary Not in Good Faith” certifications it receives from
Commerce and may open complaints with its licensees. DFI may contact the borrower and/or the mediator to
request more information.
Washington State Department of Commerce
Commerce is charged with the overall management of the program and the administration of the Foreclosure
Fairness Fund. It recruits, trains and approves mediators, receives referrals and assigns mediators to eligible
cases. Additionally, Commerce is responsible for maintaining a list of approved foreclosure mediators.
The FFA identifies the following groups as eligible to become foreclosure mediators:
Attorneys
Retired judges
U.S. Department of Housing and Urban Development-approved counselors
Employees and volunteers of Dispute Resolution Centers
Commerce requires participating mediators to take foreclosure mediation training and have additional documented
mediator training and experience. 12 Currently, 48 active mediators are on Commerce's approved list. Mediators
have full discretion in conducting the sessions and facilitating the mediation process. They aim to assist the
parties with achieving positive outcomes whenever possible.
12 Washington State Department of Commerce, "Interested in Becoming a Mediator?", (2013)
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 8
Program funding
The Foreclosure Fairness Program is fully funded through the revenue received via two separate fees:
1. As of Jan. 1, 2022, each beneficiary (financial institution) must pay a $250 fee into the Foreclosure Fairness
Account (FFA), an account established by RCW 61.24.172, for each residential real property issued a notice of
default in Washington during a given quarter. 13 The statutory language for this fee is in RCW 61.24.190.
2. Chapter 393 of Laws of 2025 added an $80 origination fee placed on residential mortgage loans that are used
for property in Washington as of July 27, 2025, with funding going to the Foreclosure Fairness Program. This
new Foreclosure Prevention Fee is outlined in RCW 61.24.157. The "Legislative updates and changes" and
"Recommendations" sections provide additional information on the status of program funding and the new
Foreclosure Prevention Fee.
Path to mediation
The following section provides an overview of the foreclosure mediation process as of April 2025 to contextualize
the data displayed throughout the report. The following descriptions do not account for the upcoming program
expansions dedicated to homeowner and condominium owner association foreclosures. For additional information
about these upcoming changes, please see the "Legislative updates and changes" section of this report. The
following descriptions apply only to the foreclosure mediation process for non-judicial deed of trust foreclosures.
Meet-and-confer period
The "meet-and-confer" established in the Deeds of Trust Act identifies notification steps before foreclosure:
1. Lenders (Beneficiaries) must issue Notice of Pre-Foreclosure Options letters at least 30 days before issuing
Notices of Default. Notices of Pre-Foreclosure Options letters explain to borrowers that they are at risk of
losing their homes, that free housing counseling is available to help them understand their options, and that
they may participate in mediation. The letters also inform borrowers of the opportunity to meet with the
beneficiaries to try to resolve the issue, known as the "meet-and-confer" meeting.
2. If the borrower responds to the Notice of Pre-Foreclosure Options and requests a "meet-and-confer," a Notice
of Default cannot be issued for an additional 60 days.
3. After the Notice of Default is issued, beneficiaries must wait at least 30 days before recording a Notice of
Trustee's Sale.
Referral to mediation
Following the "meet-and-confer" period, beneficiaries and borrowers may meet for mediation:
1. Borrowers become eligible for mediation once a Notice of Default is issued. Borrowers remain eligible until 90
days before the date of sale listed in the Notice of Trustee's Sale or 25 days before the date of sale listed in an
Amended Notice of Trustee's Sale. 14 Voluntary mediation is available if beneficiaries are exempt from
mediation or if borrowers were referred to mediation after the referral request deadline. However, beneficiaries
are not required to agree to participate in mediation.
2. Borrowers must be referred to Commerce for mediation by housing counselors or attorneys. Housing
counselors' services are free to borrowers.
3. Upon receipt of completed referrals, Commerce has 10 days to assign mediators and notify all parties that
mediation was requested.
4. Assigned mediators have 70 days to commence initial mediation sessions, possibly extending beyond 70 days
if both parties agree to an extension. Once the mediation process begins, the parties will incur a fee, split
13 Beneficiaries who issued fewer than 250 notices of default in a calendar year are exempt from this fee per RCW 61.24.190(6)(a).
14 This timeline became effective on July 23, 2023, due to the passage of Chapter 206, Laws of 2023 (HB 1349).
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 9
evenly between borrowers and beneficiaries, paid directly to mediators. The participants in the mediation must
address foreclosure issues to enable the parties to reach an agreed-upon resolution. To do this, mediators will
ask the participants to consider the borrower's economic position, the net present value for beneficiaries of
receiving payments from a modified mortgage compared to the recovered costs following foreclosure,
affordable modifications and any applicable loss mitigation guidelines for loans insured by the Federal
Housing Administration, the Veterans Administration or the Rural Housing Service.
Mediation certification:
1. Within seven business days of the completion of mediation, mediators must certify the mediation outcomes to
Commerce and send copies of the certifications to all parties involved.
2. The certifications must indicate whether resolutions were reached, describe the resolutions and indicate
whether the parties participated in good faith.
3. If no agreement was reached, the mediator must also describe the Net Present Value analysis used and its
results.
4. Findings that beneficiaries did not act in good faith may constitute a defense against non-judicial foreclosure
actions. Borrowers may use these findings in court to stop foreclosures.
5. Commerce receives all certifications from mediators and sends copies of the certification showing
"Beneficiary Not in Good Faith" to the AGO and to the Department of Financial Institutions (DFI) for review.
6. Findings that borrowers failed to mediate in good faith authorize beneficiaries to proceed with foreclosures.
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 10
Program outcomes
This section presents statutorily required outcomes data by Commerce and program partners for:
The Foreclosure Mediation Program
Housing counseling services
The Washington State Homeownership Hotline
Civil legal aid services
The Foreclosure Compliance Program
Foreclosure Mediation Program outcomes
The following sections present data sets collected by Commerce and FFP programmatic partners. Tables 2
through 11 include housing counseling outcomes, civil legal aid outcomes, homeownership hotline outcomes, and
foreclosure compliance program outcomes.
Department of Commerce
Program data is collected and presented in two ways:
1. Cumulative program data over the life of the program, from SFY 2012 through SFY 2025
2. Data from SFY 2025 independently
Tables 2—8 show data as required in statute. For a navigational guide through the data and the statutory reporting
requirements, please refer to Table 1 in the Executive summary.
Table 2 shows an overview of mediation case referrals the FFP has received overall and separately in SFY 2025.
Table 2: Mediation referrals for SFY 2025 and since program start
Mediation referrals Cases in 2025 Cases since program start, 2012-2025
Total mediation referrals received 336 13,413
Referred by housing counselors 203 (60.42%) 6,127 (45.68%)
Referred by attorneys (private and civil legal aid) 133 (39.58%) 7,286 (54.32%)
Cases assigned to mediators* 300 11,837
Cases completed/closed** 290 11,618
Cases ineligible for mediation*** 28 1,321
Source: Washington State Department of Commerce
* Includes cases that have been mediated, closed or pending an outcome.
** The Figure for SFY 2025 may be greater than the total number of referrals received due to carryover from prior years' cases.
*** Cases are typically deemed ineligible because the beneficiary was exempt or the referral submission missed the statutory eligibility
timeframe.
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 11
Table 3 shows case outcomes data for SFY 2025 and since the FFP started in 2012 for mediation sessions that
resulted in agreements.
Table 3: Mediation session outcomes where agreements were reached, SFY 2025 and since
program start
Outcomes Cases in 2025 Cases 2012—2025
Mediation session(s) occurred — agreement reached 119 3,533
Borrower stayed in the home (subcategories below are not mutually exclusive) 81 2,705
• Reinstatements 48 374
• Repayments 6 105
• Extension 8 221
• Adjusted rate to fixed rate 1 234
• Amortization extensions 5 542
• Interest rate reductions 2 992
• Principal reductions 1 123
• Monthly principal payment reductions 1 394
• Monthly interest payment reductions 0 275
• Refinances 1 73
• Other loan structures/modifications 18 1,026
• Principal forbearances 1 180
• Interest forbearances/write-offs 0 47
• Fees and penalties forbearances/write-offs 0 38
• Other forbearances* 0 74
Source: Washington State Department of Commerce
* Due to the way the certification is structured, Commerce cannot identify unique restrictions and modifications.
Table 4 shows case outcomes data for SFY 2025 and since the FFP started in 2012 for cases that did not include a
mediation session.
Table 4: Outcomes in which no mediation session occurred, SFY 2025 and since program start
Outcomes in which no mediation session occurred Cases in 2025 Cases 2012-2025
Number of assigned referrals in which no mediation session occurred 134 4,896
Home-retention agreement reached before the session 90 2,694
Non-retention agreement reached before the session 12 347
Borrower withdrawal from mediation (not included in other categories) 12 712
Source: Washington State Department of Commerce
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 12
Table 5 shows case outcomes data for SFY 2025 and since the FFP started in 2012 for borrowers who did not stay
in the home.
Table 5: Mediation session outcomes - borrower did not stay in the home, SFY 2025 and since
program start
Non-Retention (categories are not mutually exclusive) Cases in 2025 Cases 2012-2025
Deeds in lieu 0 55
Short sales 2 240
Voluntary surrenders 0 49
Cash for keys 0 30
Other non-retention agreements* 39 582
Source: Washington State Department of Commerce
* This includes postponing the trustee's sale date, delaying the recording of the notice of trustee's sale and enforcing other non-retention
agreements.
Table 6 shows case outcomes data for SFY 2025 and since the FFP started in 2012 for mediation sessions that
resulted in a finding of not in good faith.
Table 6: Mediation session outcomes - findings of not in good faith, SFY 2025 and since
program start
Findings of not-in-good-faith Cases in 2025 Cases 2012-2025
Borrower not in good faith* 33 1,198
Beneficiary not in good faith 1 359
Both borrower and beneficiary not in good faith** 1 32
Source: Washington State Department of Commerce
* Typically reported reasons for lack of good faith for either or both the borrower and beneficiary include: Lack of timely or accurate
provisioning of documents to the mediator or other party; failure to appear at or participate in mediation; failure to pay the mandated share of
the mediation fee; the beneficiary's representative was not authorized to make binding decisions.
** Even though the certification specifically tracks parties "not in good faith," multiple outcomes are not explicitly tracked as being in "good
faith."
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 13
Housing counseling outcomes
Tables 7 and 8 present housing counseling outcomes data from WSHFC.
Washington State Housing Finance Commission
Table 7 shows SFY 2025 case data for housing counseling agencies, including the total number of clients and other
outputs and outcomes, including cases still in process.
Table 7: Housing counseling agencies' overall outputs and outcomes in SFY 2025
Category description Cases in 2025
Clients 7,665
Referrals to other services 3,687
Pending outcomes (still in counseling) 2,650
Withdrawals from counseling 1,569
Home retention agreements 1,664
Non-retention agreements 1,454
No agreements 283
Foreclosures 10
Source: Washington State Housing Finance Commission
The data in Table 8 reflects housing counselors' services to borrowers requesting meet-and-confer sessions. In the
foreclosure process, meet-and-confer sessions take place before mediation. This table does not include
information on services provided by private attorneys, which are not required to be reported. The FFP funds
services provided by HUD-certified housing counselors and legal aid attorneys, who regularly report their activities
to the WSHFC.
Table 8: Housing counselors' meet-and-confer outcomes in SFY 2025
Category description Cases in 2025
Number of meet-and-confer sessions attended 2,605
Number of pending outcomes 1,209
Number of withdrawals from counseling 425
Number of home-retention agreements 856
Number of non-retention agreements 8
Number of no agreements 107
Source: Washington State Housing Finance Commission
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 14
Washington State Homeownership Hotline outcomes
Washington Homeownership Resource Center
Table 9 shows monthly and yearly total phone call data prepared by WHRC staff from self-reported data from
callers to the Washington State Homeownership Hotline.
Table 9: Phone calls received by the Homeownership Hotline in SFY 2025 by fiscal month
SFY 2025 fiscal month Calls received
July 1,691
August 1,683
September 1,545
October 1,655
November 1,313
December 1,296
January 1,566
February 1,517
March 1,693
April 1,312
May 1,159
June 867
Total 17,297
Source: Washington Homeownership Resource Center
Table 10 presents SFY 2025 Washington State Homeownership Hotline data on reasons for calling the hotline by
percentage of calls by topic.
Table 10: Reasons for calling the Washington State Homeownership Hotline in SFY 2025
Reason for calling Percentage of calls received in 2025
Mortgage default 57.8%
Home purchase information 12.3%
Tax issues 8.8%
Notice of pre-foreclosure options letter 4.2%
Home repair inquiry 3.8%
Notice of default 3.5%
HOA/COA Issues 3.5%
Notice of trustee's sale 3.3%
Other 1.7%
Legal 1.0%
Source: Washington Homeownership Resource Center
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 15
Table 11 presents SFY 2025 Washington State Homeownership Hotline data on the reasons callers reported for
defaults.
Table 11: Reasons for default reported by callers to the Washington State Homeownership
Hotline in SFY 2025
Reason for calling Calls received
Not provided 53.1%
Loss of income 20.3%
Medical issues 7.8%
Income reduction 6.3%
Increase in expenses 3.9%
Death of family member 3.5%
Divorce/separation 2.7%
Other 1.8%
Loan payment increase 0.6%
Source: Washington Homeownership Resource Center
Civil legal aid outcomes
Office of Civil Legal Aid
Tables 12-19 present civil legal aid outcomes as captured and reported by the Northwest Justice Project's
Foreclosure Prevention Unit and the Office of Civil Legal Aid.
Table 12 presents SFY2025 civil legal aid case disposition outcomes data from the Northwest Justice Project and
the Office of Civil Legal Aid.
Table 12: Civil legal aid case disposition outcomes in SFY 2025
Case disposition Cases
Closed 353
Opened 167
Rejected 51
Total 571
Source: Northwest Justice Project and the Washington State Office of Civil Legal Aid
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 16
Table 13 presents SFY 2025 case data on civil legal aid client race survey results from the Northwest Justice
Project and the Office of Civil Legal Aid.
Table 13: Civil legal aid client race survey results, SFY 2025
Race Cases
Asian 22
Black 31
American Indian or Alaska Native 9
Native Hawaiian/Pacific Islander 5
Hispanic or Latino 40
Slavic/Eastern European 4
Middle Eastern 1
More than One Race 23
Prefer not to Answer 20
Unknown 7
Other 5
White 375
Total 542
Source: Northwest Justice Project and the Washington State Office of Civil Legal Aid
Table 14 presents SFY 2025 civil legal aid case client language survey result data from the Northwest Justice
Project and Office of Civil Legal Aid.
Table 14: Civil legal aid client language survey results in SFY 2025
Language Cases
English 526
Spanish 13
Arabic 0
Japanese 0
ASL 0
Cambodian 0
Tagalog 1
Russian 1
Farsi 1
Total 542
Source: Northwest Justice Project and the Washington State Office of Civil Legal Aid
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 17
Table 15 presents SFY 2025 civil legal aid case data on reasons cases were closed from the Northwest Justice
Project and the Office of Civil Legal Aid.
Table 15: Civil legal aid case close reasons in SFY 2025
Case close reason Cases
A - Counsel or Advice 221
B - Limited Action 40
F - Negotiated Settlement w/o Litigation 30
G - Negotiated Settlement with Litigation 0
H - Administrative Agency Decision 1
IA - Uncontested Court Decision 2
L - Extensive Service 39
XA - Deselect Counsel or Advice 2
Total 335
Source: Northwest Justice Project and the Washington State Office of Civil Legal Aid
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 18
Table 16 presents SFY 2025 civil legal services case category data from the Northwest Justice Project and the
Office of Civil Legal Aid.
Table 16: Civil legal aid services provided in SFY 2025
Services provided Cases
Other 23
Provided advice and counsel 253
Obtained settlement agreement for claims 13
Attended mediation 2
Requested mediation 4
Referred to bankruptcy attorney 31
Requested meet-and-confer 6
Attended meet-and-confer 1
Filed bankruptcy 0
Referred to housing counselor 53
Referred to Rescue Loan/Homeowner Assistance Fund (HAF) 36
Submitted a Request for Mortgage Assistance (RMA) 2
Submitted Homeowner Assistance Fund application 46
Submitted escalation 12
Obtained surplus funds 2
Obtained title 4
Obtained settlement 12
Assist with probate 2
Prevented foreclosure 42
Delayed eviction 0
Meaningful representation/outcome not achieved 3
Vindicated rights in real property 6
Obtained loan modification 1
Obtained bankruptcy protection 1
Obtained repayment plan/workout agreement 1
Obtained HAF funds 33
Outcome not found 6
Source: Northwest Justice Project and the Washington State Office of Civil Legal Aid
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 19
Table 17 presents SFY 2025 civil legal aid counseling case outcomes data from the Northwest Justice Project and
the Office of Civil Legal Aid.
Table 17: Civil legal aid counseling outcomes in SFY 2025
Counseling outcome Cases
Currently in negotiation with servicer; outcome unknown 7
Referred homeowner to servicer with action plan and no further counseling activity; outcome unknown 52
Foreclosure put on hold or in moratorium; final outcome unknown 0
Brought mortgage/HOA /tax current with rescue and/or HAF funds 35
Brought mortgage/HOA /tax current without rescue and/or HAF funds 5
Mortgage modified with monthly payment less than or equal to 38% of gross monthly income with at least a 5-year fixed rate 2
Mortgage modified with monthly payment greater than 38% of gross monthly income or interest rate fixed for less than 5
0
years and appears not to be sustainable
Homeowner(s) sold property (not short sale) 4
Pre‐foreclosure sale/short sale 0
Initiated forbearance agreement/repayment plan 1
Other 0
Counseled and referred to another social service or emergency assistance agency 0
Bankruptcy 1
Counseled and referred for legal assistance 0
Withdrew from counseling 71
Outcome not yet achieved 69
Obtained settlement agreement for claims 8
Obtained title to property via deed 1
Assisted with probate proceeding 2
Arrearage cancelled or waived 1
Partial claim 2
Repayment plan 1
Total 262
Source: Northwest Justice Project and the Washington State Office of Civil Legal Aid
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 20
Table 18 presents SFY 2025 civil legal aid foreclosure case outcomes data from the Northwest Justice Project and
the Office of Civil Legal Aid.
Table 18: Civil legal aid foreclosure outcomes in SFY 2025
Outcome Cases
Prevented foreclosure or other loss of home 53
Delayed eviction/provided time to seek alternative housing 0
All – Client benefited from meaningful representation – desired outcome not achieved 4
Vindicated rights in real property 2
Obtained advice brief service and/or referral on housing matter 152
Obtained loan modification to preserve homeownership 2
Represented in foreclosure mediation 0
Obtained federal bankruptcy protection to preserve home 2
Total 215
Source: Northwest Justice Project and the Washington State Office of Civil Legal Aid
Table 19 presents SFY 2025 civil legal aid client economic outcomes data from the Northwest Justice Project and
the Office of Civil Legal Aid. The preserved fair market value and preserved equity figures are measured in dollars.
Table 19: Civil legal aid client economic outcomes in SFY 2025
Economic outcome Total
Preserved fair market value $21,379,507
Preserved equity $15,046,336
Source: Northwest Justice Project and the Washington State Office of Civil Legal Aid
Foreclosure Compliance Program outcomes
Office of the Attorney General
The Consumer Protection Division AGO created the Foreclosure Compliance Program (FCP) to enforce the Deed of
Trust Act, as amended by the Foreclosure Fairness Act. The FCP provides services as part of Washington’s
foreclosure prevention network and supports the Washington HAF Program as an identified contact for mortgage
assistance requests. Every year, the FCP receives and reviews hundreds of consumer complaints, inquiries from
housing counselors and other professionals and referrals from other agencies related to foreclosure issues. The
FCP also monitors a variety of issues and participates in litigation where appropriate. An overview of recent efforts
is described below.
During the last biennium (July 1, 2023, to June 30, 2025), the FCP fielded almost 600 calls about mortgage loans,
foreclosure and loan servicing problems impacting Washingtonians. Over those two years, the FCP received a total
of 473 complaints and inquiries on foreclosure issues from various partners:
427 total consumer complaints about mortgage loans, foreclosure mediation, loan servicing problems and other
related matters. Not all consumers who file a complaint are facing imminent foreclosure. In such cases, the FCP
provides consumers with information about the FFA, refers them to housing counselors and other resources, and
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 21
offers informal complaint-resolution services to consumers and lenders to address issues that could otherwise
lead to foreclosure.
46 escalated complaints directly from housing counselors. These complaints typically raise concerns that a
lender is not participating in good faith with legal requirements. The housing counselor can submit a Mortgage
Assistance Request form, which will be escalated to a FCP specialist for specific action to delay a pending
foreclosure sale to allow the mortgage servicer and consumer to complete any FFA requirements. These
services frequently prevent homeowners from avoidable foreclosures.
The FCP is both successful and popular with partners. As one housing counselor recently expressed to the FCP
and other partners: “I wanted to thank you for your wisdom … I just received confirmation from the Trustee the sale
was postponed … Your suggestion was brilliant, and this Veteran is grateful.”
In addition to complaints and inquiries, FCP regularly receives referrals from Commerce about bad faith
certifications in the Foreclosure Mediation Program (FMP). The FMP created a framework for homeowners and
beneficiaries to avoid foreclosures by engaging in mediation and negotiating loan modifications. The statute
specifically provides that “...failure to mediate in good faith may impair the beneficiary's ability to foreclose on the
property or the borrower's ability to modify the loan or take advantage of other alternatives to foreclosure” RCW
61.24.163(7)(b)(iii) & (10). To add teeth to the good faith requirement, the statute provides that violations of the
duty to mediate in good faith are unfair or deceptive acts in trade or commerce under the Consumer Protection Act.
When Commerce forwards these “bad faith” certifications to the FCP, the program reviews them for repeat
offenders or particularly egregious conduct that warrants further investigation. The number of these “bad faith”
referrals from Commerce has declined in recent years: only one in 2025, one in 2024 and three in 2023.
Between July 1, 2023, and June 30, 2025, the FCP engaged in a variety of consumer protection enforcement
actions and other advocacy to protect consumers in mortgage loan, foreclosure, loan servicing and related
matters. This work includes investigations into “zombie mortgage” servicers, who typically attempt to collect on
second mortgages taken by consumers during the 2007-2010 foreclosure crisis. A common pattern is that the loan
servicer took little to no collection activity for years, and during that time, many consumers refinanced their homes
or went through other proceedings (e.g., bankruptcy) that led them to believe their loans had been paid off. As
housing values have risen, loan owners and servicers are now pursuing payments, including seeking all past-due
principal and interest. At least some of those claims are barred by various statutes of limitations and other laws
intended to protect borrowers. The FCP also continues to monitor consent decrees obtained against entities that
committed per se violations of the Consumer Protection Act by collecting unlawful and excessive fees through
contracts with consumers to recover surplus proceeds from delinquent property tax foreclosure sales, in violation
of RCW 63.29.350.
Between July 1, 2024, and June 30, 2025, the FCP also continued to participate in partner meetings convened by
Sen. Orwall concerning funding levels for the FFA (and therefore the availability of housing counselors, legal aid
attorneys and the administration of the mediation program), including testimony before the legislature in support of
Sen. Orwall’s SB 5686, codified as Chapter 393, Laws of 2025.
The FCP expects that these partner meetings and/or other similar stakeholder meetings led by Representative
Orwall will continue during the period leading up to and during the next legislative session.
Finally, and more generally, the FCP regularly received and continues to receive case-specific and issue-related
input from the Department of Commerce (Commerce), including requests to respond to homeowners and
counselors. The FCP and Commerce work collaboratively on these matters to solve common issues.
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 22
Foreclosure updates and information
SFY 2025 saw several developments occur, impacting the resources available to distressed homeowners
throughout Washington. The most notable events include the conclusion of the Washington Homeowners
Assistance Fund (HAF) and the end of the Veterans Affairs Servicing Purchase Program (VASP). The conclusion of
these programs increases pressure on the remaining foreclosure assistance resources offered through the FFP,
including foreclosure mediation, legal aid and housing counseling.
Washington Homeowners Assistance Fund (HAF)
Using federal funds allocated under the American Rescue Plan, the HAF program offered a suite of services to
assist borrowers affected by the COVID-19 pandemic in stabilizing their housing situations and, whenever possible,
avoiding foreclosure. Applications for funds closed on April 7, 2025.
HAF offered the following services:
A maximum grant amount of up to $60,000 for homeowners who work with a housing counselor or legal aid
attorney to evaluate all options and determine the best use of the program funds in addressing the needs of the
homeowner.
Financial assistance for payment of delinquent property taxes to cure the default and for homeowner's
association fees or liens, condominium association fees, common charges and similar costs payable under a
unit occupancy agreement by a resident member in a cooperative housing development.
Washington HAF funds covered the following:
Reinstatement of a mortgage
Reduction of the amount owed on a mortgage
Reduction of the mortgage interest rate
Funds are also available for the following:
Home-related insurance
Homeowner's association fees or liens
Delinquent property taxes
Washington HAF funds did not cover the following:
Utilities
Internet service
Mortgage payment assistance for future mortgage payments
Home repairs
Reimbursement of funds previously expended by state or local governments
For more information about the HAF program, please visit the WSHFC's Homeowner Assistance Fund website.
The Veterans Affairs Servicing Purchase Program (VASP)
The Veterans Affairs Servicing Purchase program, also known as VASP, was introduced by the U.S. Department of
Veterans Affairs (VA) as a last-resort home-retention option for "eligible Veterans, active-duty Service members,
and surviving spouses with VA-guaranteed home loans who are experiencing severe financial hardship." 15 VASP
was introduced in 2024 and ended on May 1, 2025. Additional information about the VASP Program can be found
on the U.S. Department of Veterans Affairs website.
15 US Department of Veterans Affairs, VA announces new program to help more than 40,000 Veterans stay in their homes, (April 10, 2024)
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 23
Legislative updates and changes
The passage of Chapter 393, Laws of 2025 (E2SSB 5686)
The 2025 legislative session saw the passage of E2SSB 5686 (Chapter 393, Laws of 2025), legislation that expands
the FFP, creates an additional funding source and revises program funding distribution between programmatic
partner agencies — see the Changes to program funding distribution section below.
Homeowner association and condominium association foreclosure protections
Beginning on Jan. 1, 2026, Commerce will accept referrals on behalf of unit owners (e.g., homeowners) who are
experiencing a foreclosure action initiated by their homeowners' or condominium owners' association. Also,
beginning on Jan. 1, 2026, unit owners who are delinquent on their association dues and at risk of foreclosure can
request a meet-and-confer meeting with their association to discuss alternatives and remedies for their
delinquency. The meet-and-confer session is a prerequisite for requesting foreclosure mediation in the future
(certain circumstances may alter this requirement).
How can a unit owner obtain a housing counselor?
Unit owners who are behind or delinquent on their association assessments or dues can obtain a housing
counselor at no cost by calling the Washington Homeownership Resource Center's homeownership hotline. 16
How does a unit owner request a meet-and-confer session with their association?
Per RCW 61.24.155(5)(b), a housing counselor or an attorney must submit a written request to the association on
behalf of the delinquent unit owner requesting that the unit owner and the association meet-and-confer over the
delinquency and assessments charged.
Who will be eligible to mediate their association delinquency through the Foreclosure Mediation Program?
Any delinquent unit owner can mediate with their association through the Foreclosure Mediation Program, with a
neutral third-party mediator. Unit owners must be referred by a housing counselor or an attorney, and the referral
must be made within the applicable timeline outlined in the following section.
What is the referral timeline for an association foreclosure mediation referral?
RCW 61.24.155(7) outlines the association foreclosure mediation timeline as follows:
Referrals to foreclosure mediation by housing counselors or attorneys may be made at any time after:
The meet-and-confer session occurs
Refusal to participate in the meet-in-confer session by the association
Thirty days have passed since the meet-and-confer session request was made by the unit owner's housing
counselor or attorney, with no response from the association
The referral to the foreclosure mediation timeline for an association foreclosure is influenced by the type of
foreclosure the association is pursuing.
16 Unit owners who are behind or delinquent on their assessments or dues to their association may obtain a housing counselor at no cost by
calling the Washington Homeownership Resource Center’s homeownership hotline at 877-894-HOME (4663).
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 24
Table 20 outlines the referral submission deadlines based on association foreclosure type.
Table 20: Association foreclosure mediation referral submission deadlines
Judicial foreclosure Non-judicial foreclosure 17
No later than 90 days prior to the date of sale listed in a notice of
trustee's sale provided to the unit owner.
If an amended notice of trustee's sale is recorded after the
Any time prior to the entry of judgment.
trustee sale has been stayed pursuant to RCW 61.24.130 the unit
owner may be referred to mediation no later than 25 days prior to
the date of sale listed in the amended notice of trustee's sale.
If the unit owner does not have sufficient time to request and have a meet-and-confer session with their
association due to a pending deadline as described in Table 20 above, RCW 61.24.155(7) allows the unit owner to
circumvent the meet-and-confer session requirement and have a foreclosure mediation referral be submitted on
their behalf by either a housing counselor or an attorney.
Foreclosure Prevention Fee
Due to the demand for the resources provided by the FFP, reliable funding is key for future success. The new
foreclosure prevention fee, created by Chapter 393, Laws of 2025, along with the existing notice of default fee
(RCW 61.24.190), enables the FFP to continue providing needed resources to struggling homeowners.
The statute creating the foreclosure prevention fee states:
(1) For each residential mortgage loan, as defined in RCW 31.04.015(24), originated within or outside of the state of
Washington and related to property located within the state of Washington, excepting only reverse mortgage loans issued
to seniors over the age of 61, a foreclosure prevention fee of $80 shall be assessed and due and payable at the time of
closing by the escrow agent or other settlement or closing agent processing the loan closing into the foreclosure fairness
account created in RCW 61.24.172. This foreclosure prevention fee may be financed in the loan and paid from the loan
proceeds or from any borrower cash contribution at the time of closing. The department may make policies and
procedures related to the implementation, collection, remittance, and management of the fee and may enter into
individualized agreements governing the efficient remittance of the fee.
(2) At or before the time that the foreclosure prevention fee is assessed under subsection (1) of this section, the escrow
agent or other settlement or closing agent must provide the borrower with a notice of the foreclosure prevention fee and
its purpose. The department must create a notice form that an escrow agent or other settlement or closing agent may use
to satisfy this notice requirement. The notice form must include the toll-free numbers for the statewide foreclosure hotline
recommended by the housing finance commission.
Additional information about the foreclosure prevention fee can be found our program website.
17 Associations pursuing a non-judicial foreclosure are uncommon in Washington state. The majority of association foreclosures are done
through a judicial foreclosure action.
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 25
Foreclosure Fairness Account revenue report
Commerce's reporting requirements have expanded to include revenue data due to the new foreclosure prevention
fee. Commerce must start reporting information for the period between July and November 2025 and then
continue reporting annually via the website thereafter:
By December 31, 2025, the department shall provide a report to the appropriate committees of the legislature on the
number and amounts received from the notice of default fee remitted under RCW 61.24.190 and the foreclosure
prevention fee remitted under RCW 61.24.157 into the foreclosure fairness account authorized under RCW 61.24.172 for
revenue collected from July 1, 2025, through November 30, 2025, and then post such information on the department
website annually thereafter.
Implementation
During the later months of SFY 2025 and the first half of SFY 2026, the FFP partners have been working diligently to
implement all new and expanded components of the program.
New and expanded components of the program:
Common interest community foreclosure mediation training designed for FFA participating mediators
Common interest community foreclosure mediation training designed for housing counselors
Tailored outreach to common interest communities using the newly allotted outreach funds (0.5% of the FFA) to
make sure associations are aware of the new requirements when initiating foreclosure, judicial or non-judicial, in
Washington
New program materials tailored to common interest community and association foreclosure mediations,
including:
Foreclosure mediation referral form standardized to common interest community foreclosure mediation
requests
Foreclosure mediation certification form standardized to common interest community and association
foreclosure mediation conclusions, per RCW 61.24.163(15)
Helpful informational guides for unit owners and associations about foreclosure mediation requirements,
timelines and guidelines
English and Spanish notice of delinquency templates will be available for download online to make sure
association compliance and process consistency
Commerce produced multiple pieces of guidance about the implementation and details of the new foreclosure
prevention fee targeted to entities impacted by the legislation. These guidance documents are available on our
program website.
Commerce has produced and distributed a borrower disclosure form, as required by statute, outlining the details
of the new Foreclosure Prevention Fee and foreclosure resources. The disclosure form can be found on our
program website.
Commerce, to reduce the administrative compliance burden, produced a process for escrow agents or other
settlement or closing agents to enter into an individualized agreement to remit collected foreclosure prevention
fees in bulk on a regular cadence (weekly, monthly or quarterly) rather than individually remitting each fee.
Information and instructions about individualized agreements can be found on our program website.
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 26
Changes to program funding distribution
Revenue received via the program funding mechanisms are collected in the FFA (RCW 61.24.172) and distributed
according to a statutorily mandated percentage allocation. Figures 1 and 2 show the funding allocations before
and after the passage of Chapter 393, Laws of 2025 (SB 5686).
Figure 1 shows the distribution of FFA funds before the passage of Chapter 393, Laws of 2025 (SB 5686), after the
$400,000 allocation to the Homeownership Resource Hotline.
Figure 1: FFA distribution model before the passage of Chapter 393, Laws of 2025
Commerce
17.00%
OCLA
6.00%
AGO
8.00%
WSHFC
69.00%
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 27
Figure 2 shows the distribution of FFA funds before the passage of Chapter 393, Laws of 2025 (SB 5686).
Figure 2: FFA distribution model after the passage of Chapter 393, Laws of 2025
Outreach
0.50%
Commerce
10.00%
Hotline
15.00%
WSHFC
50.00%
OCLA
16.50%
AGO
8.00%
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 28
Recommendations
Commerce did not seek specific statutory changes for the 2026 legislative session. This is a result of the
significant changes adopted in the 2025 legislative session through the passage of "Foreclosure Mediation
Program - Expansion" (Chapter 393, Laws of 2025). At the time of this report’s publication, those changes have
been in effect for less than a year. It will take time to determine what, if any, unintended consequences need to be
addressed.
Statutory recommendations for future consideration
Expiration of RCW 61.24.155
The Jan. 1, 2028, expiration of RCW 61.24.155 needs to be addressed to make sure RCW 61.24.163(3) continues to
be effective after Jan. 1, 2028. RCW 61.24.163(3) states:
For association foreclosures, the referral to mediation may be made as specified in RCW 61.24.155(7). If the unit owner
has failed to elect to mediate within the applicable time frame, the unit owner and the association may, but are under no
duty to, agree in writing to enter the foreclosure mediation program.
Upon the expiration of RCW 61.24.155, the reference to RCW 61.24.155(7) in RCW 61.24.163(3) will no longer exist.
RCW 61.24.163(3) will need to be revised to refer to RCW 61.24.156(7) beginning on Jan. 1, 2028. This change will
allow for RCW 61.24.163(3) to continue to refer to an active statute about the foreclosure mediation timeline for
association foreclosures beyond Jan. 1, 2028.
In-person mediation requirement
Before the COVID-19 pandemic, it was standard practice for foreclosure mediation sessions to take place in
person. The mediator, the borrower, the borrower's representative, and the beneficiary's attorney would meet in
person with the beneficiary's representative, authorized to settle, often located out of state, who would typically join
the mediation telephonically or virtually.
With the onset of the COVID-19 pandemic, the overwhelming majority of foreclosure mediation sessions took place
virtually, either through an online video platform or telephonically, with great success. The trend of hosting
foreclosure mediation sessions virtually has continued even after the conclusion of the pandemic.
The complete virtual nature of the foreclosure mediation process has allowed for greater flexibility among
participating parties, as travel considerations are unnecessary. However, the statute still sets the default for all
foreclosure mediation sessions to "in the county where the property is located, unless the parties agree on another
location." Participating parties almost exclusively agree to meet virtually rather than "in the county where the
property is located."
RCW 61.24.163 also states:
The borrower, the beneficiary or authorized agent, and the mediator must meet in person for the mediation session.
However, a person with authority to agree to a resolution on behalf of the beneficiary may be present over the telephone
or videoconference during the mediation session.
The program statute should enshrine the right of all parties to virtually attend the mediation session if all parties
agree to that format.
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 29
Statutory mediator fee reference (RCW 61.24.163(17), RCW 61.24.163(20))
Under the statute, approved foreclosure mediators are allowed to charge reasonable fees, as authorized by the
statute and by Commerce. However, the statute and Commerce guidelines are currently out of sync and have been
for several years at the time of this report. RCW 61.24.163(20) states:
A mediator may charge reasonable fees as authorized by this subsection or as authorized by the department. Unless the
fee is waived, the parties agree otherwise, or the department otherwise authorizes, a foreclosure mediator's fee may not
exceed $400 for preparing, scheduling, and conducting a mediation session lasting between one hour and three hours.
For a mediation session exceeding three hours, the foreclosure mediator may charge a reasonable fee, as authorized by
the department. The mediator must provide an estimated fee before the mediation, and payment of the mediator's fee
must be divided equally between the beneficiary and the borrower, or between the association and the unit owner.
In 2016, Commerce approved increasing the $400 mediation fee to $600. This would entail both parties initially
paying the mediator $300 each for the first session; additional sessions would incur additional costs. Commerce
has also authorized a 4th hour fee of $130 and a rescheduling fee of $200, each split evenly between the parties.
These costs are outlined in section 4 of Commerce's Foreclosure Fairness Program Guidelines.
Commerce recommends that RCW 61.24.163(20) vests control over setting mediation fees entirely in Commerce's
guidelines rather than maintaining an outdated cost.
Foreclosure prevention fee bulk payment requirement
The initial implementation of the foreclosure prevention fee has been met with tremendous administrative and
fiscal burdens due to the overwhelming number of remittances received by Commerce from financial institutions,
title companies and escrow companies. RCW 61.24.157(1) allows Commerce to "enter into individualized
agreements governing the efficient remittance of the fee," allowing for single bulk payments to be submitted by
remitters on a regular cadence (weekly, monthly, quarterly). However, not all remitting institutions have agreed to
enter into or establish an individualized payment agreement with Commerce and have opted to instead remit each
payment separately. It would make program administration more efficient if the default statutory payment
structure promoted bulk payments and individualized agreements rather than separate individual payments.
FORECLOSURE FAIRNESS PROGRAM REPORT 2025 30
File and source
- File
- 2026_fy25-ffa-leg-report-final-95db7e27-5056-4e13-b04a-53f8282acfec.pdf
- Size
- 558,740 bytes
- SHA-256
- c2d81c911392d706c8b114fdebac92229005f19a19b47de04a10ef49b7d339e4
- Original
- app.leg.wa.gov