Excess Proceeds After Foreclosure: How To Claim Funds That Are Rightfully Yours
When most folks think about foreclosure, they imagine only the loss of their most precious asset. But what many Ohio homeowners fail to realize is that foreclosure can sometimes create an opportunity to recover money. If your property sells for more than what is owed on the mortgage, the remaining balance (known as excess proceeds) might belong to you. Unfortunately, many homeowners miss out on these funds simply because they’re unaware of their rights.
The Dayton foreclosure defense lawyers at Kohl & Cook Law Firm, LLC, have helped clients recover thousands of dollars in excess proceeds after they lost their home. Here is what every Ohio homeowner should know about foreclosure.
What are excess proceeds?
When the bank forecloses on a home, the property is usually sold at a sheriff’s sale. The sale proceeds are applied first to the mortgage debt, foreclosure costs, and any valid liens. If the sales price exceeds these obligations, then the leftover funds are considered “excess proceeds” or “surplus funds.”
For example, if your home sells for $150,000 but you only owed $130,000 on your mortgage (including fees and costs), there would be $20,000 in excess proceeds. By law, that surplus belongs to the homeowner or another lienholder—not the bank.
How does the process work in Ohio?
The excess proceeds won’t automatically appear in your bank account, unfortunately. After the foreclosure sale, the court or sheriff’s office will generally hold the funds. The homeowner must then file a motion or application with the court to claim their share. If other creditors or lienholders have claims too, the court may hold a hearing to determine who gets how much of the surplus.
This process can often be intimidating for homeowners who are already under serious financial stress. Without the proper legal guidance, it’s very easy to miss deadlines, lose out to aggressive creditors, or fail to navigate the paperwork properly.
Why homeowners miss out
Some homeowners will never claim their proceeds. Some assume that the bank keeps the money. Others simply don’t know that the funds exist. In some cases, debt collectors or third-party companies may try to swoop in and claim the money themselves.
That’s why it’s so important to act quickly. By asserting your rights early and filing the correct paperwork, you improve your chances of recovering the full amount that you’re owed.
How can Kohl & Cook help?
Kohl & Cook Law Firm, LLC, has successfully represented Ohio homeowners in recovering excess proceeds that would have otherwise gone unclaimed. Our attorneys guide clients through every step. We identify available proceeds, file the necessary court motions, and defend against competing claims for creditors. We ensure that your voice is heard and that you receive the funds you are legally entitled to. Call our office today to schedule an appointment, and we can discuss your situation in more detail.
