Washington State House Democrats


Foreclosure Fairness Act takes effect July 22

Homeowners facing foreclosure may request neutral, third-party mediation


Olympia – The Washington State Foreclosure Fairness Act Mediation Program begins Friday, July 22. The program, a result of bipartisan legislation, makes Washington one of three non-judicial foreclosure process states in the country with a program designed to help homeowners find a resolution to foreclosure proceedings with their lenders.


“I’ve heard the stories of homeowners who have called the lenders multiple times and talked with numerous people, but they have been given different instructions and, essentially, the run around in the system for years without resolution,” said State Rep. Tina Orwall (D-Des Moines), the primary sponsor of the Foreclosure Fairness Act. “This program offers homeowners hope in the form of housing counselors and a mediation session at which lenders are required to provide a representative authorized to make decisions and a neutral, third-party mediator to make sure everyone is acting in good faith.”


The Foreclosure Fairness Act requires lenders and servicers conducting more than 250 foreclosures in Washington State in the previous year to pay $250 for each Notice of Default issued. The fee provides funding for free homeownership counseling, attorneys to prosecute violations of the Washington Consumer Protection Act and foreclosure prevention outreach.


“Washington’s housing counselors have been overwhelmed by the number of homeowners in desperate need of skilled advocates adept at maneuvering the complicated and sometimes confusing processes involved in trying to prevent foreclosure,” Washington State Housing Finance Commission Executive Director Kim Herman said. “This new law provides much-needed funding to help existing homeownership counselors take on additional caseloads and to hire new counselors.”


Homeowners facing foreclosure who have received a Notice of Trustee’s Sale but whose house has not yet been sold as of July 22, and those who have received a Notice of Default but have not yet received a Notice of Trustee’s sale may request mediation with their lender or servicer through a housing counselor or attorney starting July 22.


“It is critical that homeowners facing foreclosure contact a counselor or attorney immediately to begin the mediation process,” said Dan McConnon, Assistant Director at the Washington State Department of Commerce, which oversees the new program. “For those who have already received a Notice of Trustee’s Sale, waiting could result in their being too late to participate. Participation in this program, for many, may mean finally finding an alternative to foreclosure with their lender.”


At mediation, a neutral, third-party mediator will work with the homeowner and lender to reach a fair, voluntary and negotiated agreement.


“This new law brings new incentive to lenders to work with homeowners to resolve matters outside of foreclosure proceedings and courtrooms,” said Bruce Neas from Columbia Legal Services. “It’s our hope that this program will provide homeowners the leverage they need to encourage lenders to communicate with them and reach resolutions other than foreclosure.”


The Washington State Department of Commerce is coordinating and overseeing the Foreclosure Fairness Act Mediation Program. The Washington State Housing Finance Commission is overseeing Washington counseling agencies participating in the program.



More information:




  • For more information on foreclosure prevention, avoiding foreclosure rescue or loan modification scams and alternatives to foreclosure, visit: www.homeownership.wa.gov