How to Determine if Surplus Funds Remain After a Foreclosure Sale
Detailed Answer
After a foreclosure sale in Massachusetts, any proceeds exceeding the mortgage balance and sale costs become surplus funds. Under Massachusetts General Laws Chapter 244, Section 14 and Section 15, the sheriff or court holds these funds until a party in interest claims them.
To verify if surplus funds remain, follow these steps:
- Gather Foreclosure Case Details: Identify the case number, sale date, and county. Use MassCourts eAccess (masscourts.org/eservices) or visit the county Registry of Deeds.
- Review the Sheriff’s Return: At the Registry of Deeds, inspect the foreclosure deed and sheriff’s return. The return often lists sale proceeds and any surplus.
- Search the Court Docket: In MassCourts eAccess, search for motions related to the sheriff’s return or petitions for surplus distribution. Look for entries under “Return of Sale” or “Distribution of Surplus Funds.”
- Contact the Foreclosure Sheriff’s Office: Each county sheriff handles foreclosure sales. Provide the case information and ask if they hold unclaimed surplus funds.
- File a Claim Under MGL c.244 §14: Any party in interest—such as a junior lienholder or the former homeowner—can file a motion for distribution of surplus funds in the court that oversaw the foreclosure. Prepare an affidavit stating your interest and supporting documents (e.g., lien, judgment).
- Obtain and Review the Distribution Order: After filing, the court issues an order allocating funds by statutory priority: senior mortgage lender, junior lienholders, and then the former homeowner. You will receive notice when the court enters the distribution order.
Helpful Hints
- Collect all lien and judgment documents before filing your claim.
- Check the court docket regularly; deadlines to petition for surplus vary by county.
- Consider consulting a title researcher or attorney for complex lien questions.
- Keep copies of all filings, notices, and correspondence with the sheriff and court.
- Act promptly: delaying too long may forfeit your right to claim surplus.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for guidance on your specific situation.