What Are Surplus Funds?

Surplus funds, often called “excess proceeds,” are the extra money left over after a property is sold at a foreclosure auction. When a home goes into foreclosure, it’s usually because the owner has fallen behind on their mortgage or owed taxes. To recover the debt, the lender or government agency sells the property at auction.

If the property sells for more than what was owed on the mortgage, loans, taxes, and any legal fees, that leftover amount — the surplus funds — legally belongs to the original homeowner.
For example, if someone owed $150,000 but their property sold for $200,000 at auction, the $50,000 difference would be the surplus funds.

Unfortunately, many former homeowners are unaware they are entitled to this money or don’t know how to claim it. In some cases, it can go unclaimed for years or get absorbed by the state if no action is taken.

In short:
➔ Surplus funds = Your money left over after foreclosure.
➔ You have the right to claim it — but you usually have to act fast.