Washington Law Review


In Washington Mutual Savings Bank v. United State, the Washington Supreme Court extended the anti-deficiency provisions of the Deed of Trust Act to all non-foreclosing junior lienors. Because this decision makes all junior obligations uncollectible following a nonjudicial foreclosure, it may have a chilling effect on lenders and a serious impact on the availability of home equity loans. This Note examines the Washington Mutual decision and suggests that the court should have determined instead that a deficiency is allowed, but should be computed after applying any surplus value in the property sold against junior obligations. This Note also recommends a statutory solution to restrict the anti-deficiency provisions to foreclosing lienors.

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