PROPERTY PROCEEDS
Tax Sale vs. Mortgage Foreclosure Surplus
How tax sale excess funds and mortgage foreclosure surplus differ in origin and process.
Different triggering events
Tax sale excess funds are triggered by unpaid property taxes and a subsequent sale conducted by a county tax authority. Mortgage foreclosure surplus is triggered by a default on a mortgage loan and a subsequent sale conducted by, or on behalf of, a lender or trustee.
Different custodians and procedures
Because the sales are administered by different entities, the funds are often held by different custodians — for example, a county tax commissioner's office versus a foreclosing attorney, trustee, or clerk of court — and the claim procedures, forms, and deadlines can differ accordingly.
Why the distinction matters
Understanding which type of sale occurred is generally the starting point for figuring out which process, records, and offices are relevant to a specific situation.
General information only. This article is provided for general educational purposes and does not constitute legal, financial, or tax advice, and is not a guarantee of any outcome. HSP is not a law firm and does not provide legal advice or legal representation. When legal services are needed, the claimant independently selects and retains legal counsel. Laws and county procedures vary and change over time; for guidance specific to your situation, consult independent legal or financial counsel.