Short answer — the practical steps

If a sheriff’s sale produced money in excess of what was owed (a “surplus”), you must quickly determine who holds priority, collect documentation proving your claim, and start a special proceeding in the circuit court where the property sits asking the court to declare your right to the surplus and order disbursement. That proceeding requires filing a petition or motion, serving interested parties, attending a hearing, and then using the court’s order to obtain payment from the county official holding the funds.

Detailed answer — step‑by‑step under Michigan law

1. Confirm whether surplus funds actually exist

Contact the county sheriff or the county treasurer who handled the sheriff sale. Ask whether the sale produced net-surplus proceeds after payment of the judgment, fees, costs, and any priority liens paid at sale. The county official can confirm the amount and tell you where the funds are being held.

2. Identify who may claim the surplus and the priority order

Common claimants are the former owner (foreclosed homeowner), junior lienholders (second mortgage, judgment liens), taxing authorities, and sometimes the purchaser. Michigan’s foreclosure-by-advertisement statutes and related rules set the order in which claims are paid. For an overview of the statutory scheme for foreclosure by advertisement, see the Michigan Compiled Laws, Chapter 600, sections beginning at MCL 600.3201 (foreclosure by advertisement) and related provisions: https://www.legislature.mi.gov/ (search MCL 600.3201 et seq.).

3. Gather and prepare supporting documents

Collect documents that prove your interest and the amount you claim, for example:

• Photo ID and proof of address.
• Deed or mortgage documents showing your ownership or lien.
• Loan payoff statements, account histories, or billing records for lien claims.
• Tax bills, judgments, or other evidence of claimed liens or obligations.
• Sheriff sale paperwork showing the sale date and amounts.

4. Prepare the court filing (special proceeding / petition)

In Michigan you typically start a special proceeding in the circuit court for the county where the property is located. The filing is often titled a petition or motion to determine rights to surplus proceeds (sometimes called a petition for distribution of surplus funds). The petition should include:

• A clear caption and court identification (circuit court for the county where the property is located).
• The legal description and address of the foreclosed property.
• The sheriff sale date and the purchaser name and sale amount.
• The exact amount of surplus (if known) and where it is being held.
• Your factual allegations and evidence supporting your claim or priority.
• A proposed order for the court to sign directing disbursement to you if the court finds in your favor.

Follow local court rules and the Michigan Court Rules for form and filing requirements. If you are unsure which form to use, contact the clerk of the circuit court for guidance about filing a special proceeding to determine distribution of surplus funds.

5. File the petition and pay fees

File your petition with the circuit court clerk and pay the required filing fee. Keep copies of everything you file and get stamped copies back from the clerk. If you cannot afford the fee, ask the clerk about fee waiver procedures.

6. Serve notice on interested parties

Serve the petition and any supporting papers on all parties who might claim the funds: the purchaser at sale, known junior lienholders, the foreclosed homeowner (if not you), the sheriff or treasurer holding the money, and any taxing authorities. Service methods and required timelines follow statute and court rules; you may need personal service or certified mail depending on local practice. Proof of service must be filed with the court.

7. Attend the hearing and present your evidence

The court will set a hearing. Bring originals and copies of your documents, witnesses if needed, and be prepared to explain why you have priority over other claimants. The judge will weigh competing claims and issue an order allocating the surplus funds.

8. Obtain and use the court order to collect funds

After the court signs an order directing payment, present the order to the county official (sheriff or treasurer) who holds the surplus. The county will typically release funds only after verifying the court’s order and completing its internal requirements.

9. If someone contests your claim

If multiple claimants appear, the court may hold additional hearings, require affidavits, or order escrow while disputes resolve. If you lose, you may have options to appeal under state appellate rules; discuss this with an attorney.

Timing considerations

Act promptly. Although the exact statutory deadlines for asserting surplus claims can vary depending on the circumstances, delays reduce your chance of success and can allow other claimants to move first. Check the foreclosure statutes and local court rules for time limits and presumptions applicable to your case.

Where to find the statutes and local procedures

Look at Michigan’s foreclosure-by-advertisement statutes (MCL 600.3201 et seq.) for the overall statutory framework. For procedural rules, consult the Michigan Court Rules and the local circuit court’s website or clerk. The Michigan Legislature site is a good starting point: https://www.legislature.mi.gov/

Helpful hints

• Contact the county sheriff or treasurer first — they can confirm whether funds exist and who is holding them.
• Gather original documents proving your interest before filing: deeds, mortgages, payoff statements, tax bills, and judgment papers.
• Identify all possible claimants and serve them correctly. Failure to serve a necessary party can delay your claim.
• Draft a clear petition: include sale details, the surplus amount, and your legal basis for priority.
• Ask the court clerk about local forms or procedures for surplus-fund petitions in that county’s circuit court.
• Consider hiring a Michigan attorney experienced in foreclosure and special proceedings — they can speed the process and reduce mistakes.
• Keep meticulous records of service, filings, and communications with the county official holding the funds.
• Remember tax consequences: receiving surplus funds may have tax implications; consult a tax advisor if the amount is significant.