Disclaimer: This article provides general information about Washington law on partition and mortgages. It does not constitute legal advice. Consult a licensed attorney for guidance on your specific situation.
Detailed Answer
When co-owners of Washington real property cannot agree on use or division, either party may file a partition action under chapter 7.60 of the Revised Code of Washington (RCW). The court will decide whether to physically divide the land or order a sale (RCW 7.60.020). If the court orders sale, it follows these key steps:
- Public Sale: The property sells at public auction under RCW 7.60.080, and the purchaser takes title free of co-owner claims.
- Liens and Encumbrances: Although the purchaser is protected from claims by co-owners, the property remains subject to recorded mortgages, tax liens, mechanics’ liens, and other encumbrances that the court directs to be paid out of proceeds (RCW 7.60.090). The court will identify all existing liens, including mortgage debts.
- Priority of Payment: Washington law (RCW 65.04.015) ranks liens by recording date. At the distribution stage, the court orders payment in this order:
- Costs of sale and partition (advertising, appraisal, clerk fees)
- Senior mortgages and tax liens
- Junior mortgages and other subordinate liens
- Any remaining liens in order of priority
- Distribution to Co-owners: After satisfying liens, the court divides the net proceeds among co-owners according to their ownership interests (RCW 7.60.100). If proceeds run short before junior liens clear, those liens go unpaid and may be pursued separately by lienholders.
- Deficiency Liability: If sale proceeds do not cover the full mortgage balance, the original mortgagor remains personally liable for the deficiency. The purchaser cannot be held responsible for any shortfall (RCW 7.60.120).
Example: Two siblings own a house with a $200,000 mortgage. The court sells it for $180,000. After $5,000 in sale costs, $175,000 goes to the mortgage. The lender can seek the $25,000 deficiency from the siblings, but no funds remain to distribute to them.
Helpful Hints
- Review the county recorder’s records for all mortgages and liens before filing.
- Estimate sale costs (advertising, trustee fees) to determine realistic net proceeds.
- Consult a title company or attorney to confirm lien priorities and potential deficiencies.
- Consider mediation among co-owners to avoid full partition proceedings.
- Keep records of all payments and court orders for future reference.