Disclaimer: This article provides general information under Iowa law and does not constitute legal advice.
Detailed Answer
In Iowa, surplus funds from a foreclosure sale occur when the sheriff sells real estate for more than the debt and costs. Under Iowa Code §626.12, any excess proceeds belong to the former owner or other claimants.
Follow these key steps to file a petition for surplus funds in the district court of the county where the foreclosure sale took place:
- Identify Eligible Claimants: You must have a legal interest in the surplus. Common claimants include the prior homeowner, junior lienholders, or judgment creditors.
- Obtain Sale Records: Request a copy of the sheriff’s sale report and the final confirmation order from the district court clerk. These documents show the sale price, debt satisfied, and any remaining balance.
- Prepare Your Petition: Draft a petition to the clerk of the district court. The petition should include:
- Your name and address.
- Description of the foreclosed property and case number.
- The amount of surplus claimed.
- Legal basis for your claim (e.g., former title holder under Iowa Code §626.12).
- Proof of interest (deed, judgment, or other documentation).
- File the Petition and Pay Fees: Submit the original petition and two copies to the district court clerk. Iowa court filing fees vary by county; contact the clerk’s office for the exact amount. In many counties, you can check fees online at the Iowa Judicial Branch fee schedule.
- Serve Notice to Interested Parties: Under Iowa Rule of Civil Procedure 1.305, you must serve the petition on all parties known to have an interest—such as the mortgagee, junior lienholders, and former owner—by certified mail or personal service.
- Wait for Objections: The court typically sets a deadline (often 20 days) for any party to object. If no objections arise, the clerk will schedule a hearing.
- Attend the Hearing: At the hearing, present proof of your interest and the calculation of the surplus. Opposing parties may appear and present objections.
- Obtain Court Order and Warrant: If the court approves your petition, it will enter an order directing the clerk to draw a warrant for payment of the surplus.
- Receive Payment: The clerk issues the warrant to the sheriff or treasurer, who pays you the surplus funds. Retain copies of the order and warrant for your records.
Helpful Hints
- Start early: Obtaining sale reports and case documents can take days to weeks.
- Double-check service: Proper service prevents delays or dismissal.
- Include supporting exhibits: Attach deeds, mortgage statements, or judgments to strengthen your claim.
- Monitor local deadlines: Counties may set specific timelines for filing and hearings.
- Consult the clerk: Reach out to the district court clerk for county-specific procedures and fee details.