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Indiana Homeowners - if your home was auctioned
You May Be Entitled To SURPLUS FUNDS -- Act Today
WHAT ARE SURPLUS FUNDS?
Surplus funds, often referred to simply as “surplus,” are the remaining funds generated from the sale of a foreclosed property when the auction price is higher than the total amount owed on the property. Surplus funds are synonymous with equity proceeds or home equity.
Home equity represents the portion of your home that you actually own. Specifically, equity is the difference between what your home is worth and what you owe your lender Therefore, when your house is sold at a foreclosure auction, if the bid is higher than the debt owed (i.e., the judgment amount in the foreclosure action), then the remaining amount is the surplus amount (less any other liens that are required to be paid upon sale).
HOW DO YOU KNOW IF YOU HAVE SURPLUS FUNDS?
If you were involved in the initial foreclosure action, then you will know when there is going to be a Sheriff's Sale. Counsel working on behalf of the lender in the foreclosure action has obtained a Judgment and Decree of Foreclosure from the Court.
After the judgment, plaintiff's counsel files a pleading called 'Praecipe for Sheriff's Sale' which gives your county's sheriff department the authority to move forward with the sale/auction. The Sheriff's Department will set a date and the Court Clerk will notify all parties in the foreclosure action via U.S. Mail.
HOW DO YOU CLAIM SURPLUS FUNDS?
Call our office today or send us a request from this website. Indiana is referred to as a judicial foreclosure state. That means that the lender is required to file a lawsuit is order to foreclose on a property when a borrower defaults on their loan. Because the foreclosure involves the courts, the only way to claim your surplus funds is through filing very specific pleadings requesting an order from the Court.
CONTACT OUR OFFICE TODAY
We provide comprehensive support to homeowners, from initial consultation to claim filing and disbursement, ensuring a streamlined and effective recovery process. We do not require any upfront fees. For homeowners facing the aftermath of foreclosure, surplus funds offer a chance to recover some of their investment in the property. This additional financial resource can help alleviate post-foreclosure challenges and pave the way for a more stable financial future
TO CONTACT US: Simply click the GREEN BUTTON below and an email will automatically be generated and sent directly to our office. Please send us your case number and the County in which your foreclosure action was filed.
Who is Entitled to Receive Surplus Funds According to Indiana's Legislature?
INDIANA CODE SECTION 32–30–10–14
The law on surplus funds in Indiana is relatively straight forward. Indiana Code Section 32–29–7–9(b) provides that if property is sold at a sheriff's foreclosure sale, “the sheriff shall pay the proceeds as provided in IC 32–30–10–14.”
The proceeds from the sheriff's sale are distributed according to Indiana Code Indiana Code Section 32–30–10–14. According to IC 32–30–10–14, the proceeds of a sale must be applied in the following order:
(1) Expenses of the offer and sale, including expenses incurred under IC 32–29–7–4 or section 9 of this chapter (or IC 34–1–53–6.5 or IC 32–15–6–6.5 before their repeal).
(2) The payment of the principal due, interest, and costs not described in subdivision (1).
(3) The residue secured by the mortgage and not due.
(4) If the residue referred to in subdivision (3) does not bear interest, a deduction must be made by discounting the legal interest.
WHO IS ELIGIBLE TO CLAIM SURPLUS FUNDS?
The last paragraph of IC 32–30–10–14 pertains to YOU, also called the mortgage debtor, mortgagor (i.e., prior homeowner). It states: "In all cases in which the proceeds of sale exceed the amounts described in subdivisions (1) through (4), the surplus must be paid to the clerk of the court to be transferred, as the court directs, to the mortgage debtor, mortgage debtor's heirs, or other persons assigned by the mortgage debtor. (Emphases added).
Therefore, IC 32–30–10–14 says that the former homeowner of record at the time of foreclosure and any subordinate lienholders, such as second mortgage holders or judgment creditors, are eligible to claim surplus funds.
What Steps ARE REQUIRED to Make a Claim for Surplus Funds?
ONLY THROUGH COURT ORDER
In any foreclosure action, after the Sheriff's Sale has taken place, the proceeds from the sale are deposited with the Clerk of Court where the original action was filed.
Once the plaintiff is paid pursuant to the court judgment, the Court then issues an ORDER REGARDING MONEY which states something like the following: "Any Defendant asserting an interest in these remaining funds is hereby directed to file a Motion to Release Funds to the Court within thirty (30) days of the date of this Order stating the amount said Defendant is claiming, as well as the reason said Defendant is entitled to receipt of any funds."
STEPS TO MAKE YOUR CLAIM WITH THE COURT
There are four basic steps involved in making a claim for surplus funds.
- Identification: A determination needs to be made to see if surplus funds exist from the foreclosure sale.
- Legal Assessment: Understand eligibility criteria and procedural requirements for filing a claim.
- Documentation: Gather necessary documents and evidence to support the claim.
- Filing a Petition: Submit the claim within specified timelines and adhere to procedural guidelines.
Once all four steps are finalized, the remaining step is to wait for your disbursement of surplus funds.
CONTACT OUR OFFICE for further assistance. We do not charge you any upfront fees or costs to take on your matter and file a petition on your behalf.
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