If your property sold for more than what you owed, you're entitled to the excess. Thousands of dollars may be sitting unclaimed. Here's how to get your money.
When your property sells at a trustee sale, proceeds are distributed in this order:
If the sale price exceeds what's owed to all lien holders, you're entitled to the difference—the "surplus" or "excess proceeds."
Property sells for $600,000. First mortgage owed: $400,000. Second mortgage: $50,000. Trustee costs: $10,000. Surplus to you: $140,000.
Under CC § 2924k, here's the process:
Contact the trustee who conducted the sale. Ask if there are excess proceeds and the amount.
Send written claim to trustee within 30 days of sale. Include proof of identity and your claim to funds.
If no disputes, trustee sends you the funds. If disputed, trustee deposits with court.
If funds deposited with court, file petition to claim. May need to prove priority over other claimants.
If funds are deposited with the court and no one claims them within 90 days, they escheat to the county. Don't wait—claim your money promptly.
After foreclosure, you may receive letters offering to help you recover surplus funds—for a fee. Be careful:
If your foreclosure happened in the past, funds may still be claimable:
All owners at the time of foreclosure typically have a claim to surplus funds. The distribution depends on:
If owners can't agree, the court decides distribution.
Potentially. Junior lien holders (second mortgages, judgment liens) get paid from surplus before you. Other creditors might try to levy on funds after you receive them. However:
Trustees must make reasonable efforts to locate you. If unsuccessful:
If you moved after foreclosure, proactively contact the trustee with your new address.
Tax treatment depends on your situation:
Consult a tax professional about your specific situation.
I can help you navigate the surplus recovery process, file court petitions if needed, and deal with competing claims. Don't leave your money on the table.