Detailed Answer
Understanding Surplus Funds in Arkansas Foreclosures
When a foreclosure sale yields more than the debt, costs, and fees, the remaining funds are called surplus proceeds. Arkansas law directs these excess funds to the former owner (grantor) or any junior lienholders.
Key Statutes
- Ark. Code Ann. § 18-50-113 (Trustee’s duties at sale and distribution)
- Ark. Code Ann. § 18-50-117 (Handling surplus proceeds)
Step 1: Locate the Sale Report or Sheriff’s Return
In a trust deed foreclosure, the trustee must file a report of sale and distribution with the circuit clerk. For judicial foreclosures, the sheriff files a return and inventory. Both documents show the total proceeds and how they were applied.
Step 2: Search the Circuit Clerk’s Records
The circuit clerk holds any undistributed surplus. Visit the clerk’s office or its online portal. Use the foreclosure case number or parties’ names to find filings related to surplus funds.
Step 3: Review the Distribution Order
The court issues an order approving distribution of proceeds. If the order lists funds remaining after paying all liens and costs, that amount is the surplus. The clerk disburses it after the claims period expires.
Step 4: File a Claim for Surplus Funds
If you are the former owner or a junior lienholder, you must file a motion or petition with the court to claim the surplus. Include proof of your interest, your lien or title documents, and valid identification. The court will review your claim and issue a disbursement order if approved.
Helpful Hints
- Obtain the foreclosure case number for accurate record searches.
- Contact the trustee or sheriff’s office for copies of sale reports.
- Note claim deadlines: Arkansas sets time limits to request surplus funds.
- Gather documentation demonstrating your right to the surplus (deed, lien instruments).
- Consult a real estate attorney if you encounter procedural issues.