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My husband and I have been out of work for 2 years. We will probably be letting the house go into foreclosure in a couple of months if things don't change.
WA St. allows for judicial and non-judicial foreclosures. I am told that the banks usually let the house go to non-judicial foreclosure.

What is the likelihood that a non-foreclosure will happen. and what is the timeline and what happens if they do a judicial foreclosure?
what are the tax implications?
what are the typical reasons for a judicial vs a non judicial foreclosure?

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Niicss · Posted: Mon Jan 18, 2010 2:05 am Post subject:

In Washington, lenders do have the option of judicial foreclosure. However, this is not a common option and lenders mainly go for the non-judicial foreclosure. A judicial foreclosure is common when there is no power of sale clause in the mortgage docs. Thus, the foreclosure must be declared by the court. On the other hand, a non-judicial foreclosure is used when there is a power of sale clause mentioned in the mortgage doc. If time, place, and terms of sale are mentioned in the doc, then that specific procedure is used by the lender. If the balance amount is forgiven by the lender, then it'll considered as your income by the IRS and you may have to pay taxes for it. But as per the Mortgage Debt Relief Act, taxes on the forgiven amount is canceled.

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Washington State Foreclosure (judician and or nonjudicial)

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