Washington Private Money Lending:
Licensing, Compliance & Documents

By Anthony Geraci, Managing Partner & CEO, Geraci LLP  |  February 2026

Washington is a strong private money lending market, centered on the Seattle-Tacoma metropolitan area with additional activity in Spokane and other growing markets. High property values in the Seattle area drive large loan amounts. However, Washington's licensing requirements are more restrictive than most states and require careful compliance planning.

This guide covers the essential licensing, usury, foreclosure, and document requirements for private money lenders originating loans in Washington.

Related: Usury Laws by State  |  Deed of Trust vs. Mortgage Guide  |  How to Lend in Multiple States

Licensing Requirements

Washington requires a Consumer Loan Company license from the Department of Financial Institutions for most lending activity, including some business-purpose loans. This is more restrictive than many states — private money lenders operating in Washington should obtain legal counsel regarding licensing requirements before originating loans.

Key Compliance Considerations

Washington's licensing requirements are more stringent than many states. Even business-purpose lenders may need a Consumer Loan Company license depending on their loan volume and structure. This is a critical compliance issue that should be addressed before entering the market.

Washington uses a deed of trust with a non-judicial foreclosure process, but the timeline is longer than most non-judicial states. Required notices include a 30-day notice of default, followed by a 90-day notice of sale.

Washington has passed recent legislation increasing borrower protections, including mediation requirements for certain residential foreclosures.

The state imposes a real estate excise tax (REET) on property sales that affects transaction costs.

Document Requirements for Washington Private Money Loans

Washington private money loans require a deed of trust as the primary security instrument, along with a promissory note, loan agreement, personal guaranty (for entity borrowers), and state-specific disclosures and compliance riders. For fix-and-flip and construction loans, draw agreements, scope of work exhibits, and completion guarantees are also required.

Automate Loan Docs generates complete, Washington-specific document packages that comply with all applicable state requirements. Every template is drafted by the attorneys at Geraci LLP, whose team has over 30 years of combined experience advising private money lenders across all 50 states — including extensive experience with Washington lending transactions.