Going through foreclosure and worrying about losing your home can be highly stressful. If you’ve received a final judgment in your foreclosure and a pending foreclosure sale, you may be left wondering what that means for your financial situation.
Mortgage surplus funds are a way that you may still be able to get money from your home after it’s sold. However, you shouldn’t rely on receiving a mortgage surplus fund from foreclosure because they are never guaranteed.
If you’re facing foreclosure, you should contact an experienced New Jersey foreclosure attorney that you can trust. Contact Denbeaux & Denbeaux Law today to learn more about how we may be able to help you.
What Are Surplus Funds From a Mortgage?
After a foreclosure is finalized, your home will be scheduled to be sold in a sheriff’s sale. A sheriff’s sale is an auction sale. Because it is an auction-style sale, you don’t know how much the house is going to sell for. If there are a lot of bidders, your house could end up being sold for a lot, or it could be sold for undervalue.
After the auction, your lender will be paid the amount they’re owed from your mortgage. Any money remaining after the lender is paid is the mortgage surplus or surplus fund. It’s important to note that if your home sells for less than what is owed to the lender, the remaining balance is known as the deficiency. Your lender could file a separate lawsuit to get this amount from you.
Any other creditors that have liens or judgments on the home can apply for the surplus funds. These creditors will have first priority over any surplus funds. If there are no other liens on the home, or if all liens are paid, and there’s still a surplus fund left, the funds should belong to the homeowner or their heirs.
How to Claim Surplus Funds From Foreclosure
After all liens on the property are paid, extra money is deposited in the Superior Court Trust Fund. The county sheriff who conducted the sale will have information about the surplus fund and how a homeowner can receive payment.
A former homeowner can file a motion with the court, including information explaining why they’re entitled to the funds. If the court approves the motion, it will issue an order directing the payment of the surplus funds to the former homeowner.
Speak With An Attorney Today
Foreclosure can be difficult. No matter where you are in the foreclosure process, an attorney can work with you to help you understand what’s going on in the process. You don’t want to miss out on money you could have received from the sale of your home.
If you’re looking for help understanding foreclosure, sheriff’s sale, or surplus funds, contact Joshua Denbeaux today to learn more about how we may be able to help you.
