Foreclosures, Evictions for Domestic Violence

How do foreclosures and evictions work?

If you, the borrower, who has a mortgage or loan on a piece of property where you live, fail to pay the mortgage loan for a period of months, the bank to whom you owe money, can foreclose on your home. The foreclosure is a legal action in which the bank goes to court to claim your property so it can sell it to make back some of the money you failed to pay. Typically a lender cannot start the foreclosure process until a loan is more than 120 days past due. If the bank is successful in court in foreclosing on your home, it means that the bank now owns the home. You no longer own it. Therefore, the bank or lender, has the right to have you leave the home. If you, the borrower, fail to leave the home, the bank can evict you. To do that the bank must first give “notice to quit” which notifies you, the former owner, of the specific amount of time you have to leave the property. This eviction lawsuit is often called an unlawful detainer, and the eviction process may take a few months. 

A notice of sale announces the sale of the foreclosed property and generally includes the property address, and the details of the public auction where the sale will take place. One alternative to foreclosure is mediation, where borrowers meet with the lender and an impartial third-party to discuss possible ways to avoid foreclosure. Borrowers are eligible for mediation up until 20 days after the notice of sale of the property is recorded. If a borrower fails to take advantage of mediation within 20 days after the notice of sale, the borrower and lender may still agree in writing to enter a mediation program. Once your property has been sold after foreclosure, the purchaser of the foreclosed home can evict tenants who have not left the property. 

In Washington State, the purchaser of the foreclosed home, such as the bank or loan provider, is entitled to possession of the home 20 days after the foreclosure sale. If you don’t leave the property, the purchaser of the foreclosed home must provide 60 days’ notice to evict tenants. 

How can I avoid foreclosure?

Foreclosure occurs when a homeowner is unable to pay the agreed upon mortgage payments or property taxes, which allows the lender to claim the property, evict the homeowner, and sell the home. Most loans have a Grace Period, or amount of time between when the payment is due and when late fees will apply. For example, if a mortgage payment is due on the first of the month, but there is a Grace Period of 5 days, then paying the mortgage payment by the 6th of the month will not result in any late fees or financial penalty. 

In Washington State, most homes are secured by a deed of trust, which are commonly referred to as mortgages, and clarify who has the authority to foreclose the property. The main difference between a mortgage and a deed of trust is that deeds of trust can be foreclosed without a lawsuit, whereas most mortgages require court involvement to begin the foreclosure process. Therefore, most mortgages in Washington can be foreclosed without a lawsuit.

However, the foreclosure moratorium is one way you can delay foreclosure. As of March 18, 2021, the foreclosure moratorium for homeowners has been extended through June 30, 2021 which will suspend or stop many foreclosures. This means lenders cannot foreclose on loans provided by Fannie Mae, Freddie Mac, HUD/FHA, USDA, or VA until after June 30, 2021.

Another way to avoid foreclosure is forbearance, which is when a borrower and a lender work together to reduce loan payments for a specific amount of time. For those who wish to request forbearance, the moratorium has extended the mortgage payment forbearance enrollment window until June 30, 2021. 

How can forbearance help me avoid foreclosure? 

Forbearance is when a borrower, such as someone who has requested a loan, makes arrangements with his or her lender, which could be a bank, to pause or reduce mortgage payments for a specific amount of time while working towards financial stability. Forbearance allows a borrower to make a payment plan and avoid paying a lump sum.

A borrower must request forbearance from his or her mortgage servicer or lender to pause payments and avoid foreclosure, which can be followed by eviction. If a borrower requests a meeting, the lender must meet to explore the borrower’s financial ability to adjust the loan payments and discuss alternatives to foreclosure. The foreclosure moratorium has extended the mortgage payment forbearance enrollment through June 30, 2021 for borrowers who want to request forbearance. 

While most service providers must offer forbearance, lenders who aren’t required to offer it have similar repayment plan options. 

The Covid hardship forbearance applies to all federally funded or federally sponsored mortgages including HUD/FHA, VA, USDA, Fannie Mae, and Freddie Mac loans. This means that homeowners with federal loans can pause or reduce mortgage payments for up to six months. Also, borrowers can request a forbearance extension for up to an additional 180 days for a total forbearance period of 360 days. 

Are there laws that prohibit housing discrimination? 

Yes. Many forms of housing discrimination are prohibited. Housing discrimination is when a housing provider tries to block someone from renting or buying housing because of their race or color, religion, sex, national origin, familial status, or disability. A housing provider could be a landlord, real estate management company, or even lending institutions such as banks or other organizations that play an important role in purchasing a home. Housing providers are not allowed to engage in housing discrimination. However, there are exceptions. 

Although housing discrimination is often difficult to spot, there are some signs to look for. Some forms of discrimination include raising prices or interest rates, lying about availability, or steering. As an example, steering is when agents only show African American buyers homes in certain neighborhoods. While in some states it is legal to discriminate against buyers or renters based on their source of income, such as Section 8 vouchers or public assistance, this practice is prohibited in Washington State. Bad customer service, such as being asked for the same information and additional documents until the property is off the market, could be another example of housing discrimination. 

With regard to disabilities, a landlord must allow a tenant to make reasonable accommodations to his or her dwelling or common areas at his or her expense if such accommodations are necessary for the person to use the housing. It is illegal to threaten, coerce, intimidate or interfere with someone exercising a fair housing right or someone assisting another person in exercising that right. 

Although discrimination based on sexual orientation or gender identity is not prohibited under federal law, discrimination against someone of the LGBT community may still be in violation of the law.

Do domestic violence survivors have rights prohibiting housing discrimination?

Yes. Housing discrimination against survivors of domestic abuse is prohibited. Housing discrimination against domestic violence survivors may take many forms, such as being denied housing, having federal housing assistance terminated, or being denied transfers from one public housing complex to another to escape an abuser. 

A tenant may notify a landlord that he/she or a household member was the victim of domestic violence to terminate the lease agreement. The tenant is only responsible for paying for the last month of rent which is the same month the tenant notified the landlord of the violence and intent to terminate the lease. The intention of this protection is to alleviate the burden on domestic abuse survivors of being stuck in lease agreements, which requires survivors to remain in unsafe environments. Domestic abuse survivors who do not have safe housing are more likely to stay in abusive and dangerous housing when they should be allowed to flee. However, the fact that a potential tenant may have been a victim of domestic violence should not affect a landlord’s decision on whether to rent to that tenant.  

Domestic abuse survivors in public housing in voucher or Section 8 project-based programs also have legal protection against housing discrimination. For example, landlords are prohibited from terminating assistance or evicting victims of domestic violence, dating violence, or stalking based on the violent acts of the abuser. 

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