How to claim foreclosure surplus funds in Washington, D.C.

How to claim surplus funds in Washington, D.C.

1. Who holds the money

   Right after the sale

   In a court foreclosure, the judge can order the sale proceeds brought into court to pay the mortgage debt, so any surplus is handled in your court case. After an out-of-court (power of sale) sale, the trustee who ran the sale holds the money and pays it out under the deed of trust.

   D.C. Code § 42-816

2. Ask for an accounting

   As soon as the sale happens

   Write to the trustee or the lender's law firm and ask for a written accounting of the sale price, the debt, costs and any surplus. Give your new mailing address. In a court case, watch the docket for the report of sale and any order about distributing the money.

3. File your claim

   Before the money is paid out or reported as unclaimed

   In a court case, file a written request in the same case asking the judge to pay the surplus to you. After an out-of-court sale, send the trustee a written demand. If the trustee will not pay or others claim the money, a lawyer or legal aid office can help you ask the court.

4. Other liens are paid first

   Second mortgages, condo or HOA liens, judgments and other liens on the home are paid in order of priority before any money comes to you. Check your accounting to make sure the debts listed are real and the amounts are right.

5. If no one claims it

   Court or government held money: 1 year after it can be paid out

   Money held by a court or government that goes unclaimed is presumed abandoned 1 year after it becomes payable and goes to the District's Unclaimed Property Unit. The District holds it with no deadline, and claiming it is free.

   D.C. Code § 41-152.01

6. Beware of surplus finder deals

   Agreements are void until 24 months after the money reaches the District

   A deal with someone to locate or recover your money held by the District is void if signed from the day the money is turned over until 24 months later, and it must be in writing and show what you get before and after the fee. There is no set percentage cap, but you can ask the Superior Court to cut an unconscionable fee. You never need to pay anyone to claim your own money.

   D.C. Code §§ 41-163.01, 41-163.02

7. Surplus after a tax sale

   Money left after a property tax foreclosure follows different rules. See our Washington, D.C. property tax foreclosure page for how owner-occupants get their equity after a trustee sale.

   D.C. Code § 47-1382.01

What District of Columbia law says about leftover sale money

Common questions in Washington, D.C.