Washington passed a bill adding a foreclosure prevention fee and notice requirement under the Mortgage Broker Practices Act and Consumer Loan Act. Under the bill, a foreclosure prevention fee of $80 must be charged to the borrower at the time of closing for each residential mortgage loan originated by a mortgage lender or broker. The foreclosure prevention fee must then be paid into the foreclosure fairness account created in the custody of the state treasurer. The foreclosure prevention fee may be financed in the loan and paid from the loan proceeds or from any borrower cash contribution at the time of closing. Note that, the required foreclosure prevention fee does not need to be assessed for a reverse mortgage loan.

In addition, at or before the time the required $80 foreclosure prevention fee is collected from the borrower, the borrower must be provided with the Foreclosure Prevention Fee Notice form. The Foreclosure Prevention Fee Notice form must include:

• The foreclosure prevention fee’s purpose; and
• The toll-free numbers for the statewide foreclosure hotline recommended by the housing finance commission.

Note that, the Foreclosure Prevention Fee Notice form does not need to be provided to a borrower for a reverse mortgage loan.

The bill becomes effective July 27, 2025.

Click to view the WA SB 5686: https://www.tenaco.com/wp-content/uploads/2025/07/WA-SB-5686-05-23-25.pdf