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How to Claim Surplus/Excess Funds in a Foreclosure

Surplus/Excess funds in foreclosure represent a unique opportunity for individuals who have defaulted on their home mortgage. When a borrower fails to make mortgage payments, the lender has the right to foreclose on the property and sell it to recoup the outstanding debt. However, in some cases, the property may be sold for more than what the borrower owes. These additional funds, known as surplus funds, are a form of financial relief for the borrower.

Understanding the process of claiming surplus funds is crucial for individuals facing foreclosure. By being aware of their rights and options, borrowers can potentially recover funds that rightfully belong to them. Surplus funds can provide much-needed financial assistance during a challenging time and help individuals move forward with their lives.

Borrowers can seek legal counsel to navigate the complexities of claiming surplus funds. An experienced attorney can provide invaluable assistance throughout the process, from determining eligibility to filing a claim and resolving any disputes.

At Schuyler Elliott & Associates, Inc., we help our clients understand their rights and pursue financial relief in Georgia. Call us at (770) 400-9102 to schedule a consultation.

Eligibility for Claiming Surplus Funds in Foreclosure Proceedings

According to the Georgia Code (O.C.G.A. § 48-4-5), certain parties with a vested interest or claim in the foreclosed property have the right to pursue these surplus funds.

Lienholders who held a valid interest in the foreclosed property may also be eligible to claim surplus funds. These may include mortgage lenders, banks, or other creditors who placed liens on the property as security for loans or debts owed by the borrower. These secondary lienholders may have a right to seek reimbursement for their outstanding balances.

After any secondary lienholders are paid off, the previous property owner may be entitled to excess funds. Despite losing ownership of the property through the foreclosure sale, the previous owner retains the right to claim any surpluses generated from the sale.

Notifying Parties of Surplus Funds

It has been our experience that mortgage companies do not notify the borrower of surplus/excess funds. Further, usually borrowers move or are evicted after the foreclosure sale and would not receive mail sent to their prior address. Therefore it is imperative that the proper parties are placed on notice that you are represented by counsel and a demand for the surplus/excess funds.

Navigating the Surplus Funds Claims Process

When it comes to claiming surplus funds resulting from foreclosure sales, understanding the steps involved is crucial.

Filing a Claim

To initiate the process, individuals seeking to claim surplus funds must send a demand for excess funds.

Claimants must provide the required paperwork to support their claim. This documentation typically includes a copy of government-issued identification to verify identity and eligibility, such as a drivers license.

Review and Approval

Once a claim for surplus funds has been demanded, the entity handling the surplus funds will review the records for any interested parties, correspond with our law firm regarding pertinent information, and disburse the funds accordingly.

Dispute Resolution

If two or more claimants present conflicting rights to the surplus funds, a resolution may be sought through legal proceedings know as an Interpleader action. Claimants may be required to present their case before a judge, who will carefully consider the evidence and arguments presented before deciding on who receives the funds. Our firm is experienced with this process and will fight for your rights and obtain the best possible outcome.

Handling a Case with Legal Help

The process of claiming surplus funds resulting from foreclosure sales is multifaceted. It requires careful navigation and understanding of legal procedures. An experienced attorney can provide invaluable guidance and support, protecting their client’s rights and seeking the financial recovery the client is entitled to.

To schedule a consultation and explore your options for surplus funds recovery in Atlanta, please get in touch with Schuyler Elliott & Associates, Inc. at (770) 400-9102.