It’s an all-too-familiar scenario for commercial lenders: a commercial loan has gone into default, and the borrower is unable to cure. The loan is secured by a deed of trust and a guaranty. The lender pursues a nonjudicial foreclosure. After the trustee’s sale, a sizable deficiency remains. The lender turns its attention to the guarantor. Is the guarantor liable for the deficiency after the trustee’s sale? Maybe, or maybe not. Division I and Division II of the Washington Court of Appeals disagree over this very question.

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