For years, “first in time, first in right” priority
for all future advances seemed certain in Washington state. Enter
the Washington Supreme Court's decision
in Commencement Bank v. Epic Solutions,
Inc.,1 which precipitated an unwelcomed return
to the common law and its attending risks respecting priority for
future advances. But to the relief of lenders, years of certainty
were followed by just months of uncertainty, as
the Washington legislature responded quickly last year to override
the Supreme Court's decision in Commencement
Bank and thereby fortify a future of certainty for future
advances in Washington state.
A future advance clause in a mortgage or deed of trust provides
security for a lender's future advance of loan proceeds to a
borrower. But not all future advance clauses are created equal. One
distinction among the group is whether the lender
is obligated to make certain advances of loan
proceeds in the future or whether the lender may, at
its option,
