What Happens to the Excess Proceeds from a Foreclosure Property Sale in Texas and Other States?

Dealing with the foreclosure of your home or property can be a frightening time. You’re undoubtedly concerned about the process, whether anything will be left over from the sale, and whether you have any claims. Often, you may hear about what happens in nearby states and assume the process is the same everywhere, but in Texas, our procedures are very specific. That’s why you should speak with a surplus funds recovery attorney who is well-versed in Texas foreclosure law.

Texas Excess Proceeds

In Texas, if you have an unpaid tax lien, a mortgage in foreclosure, a mechanics lien, or another lien on your home, a lien holder can ask a Texas court in your county for a judgment and the sale of your home to pay the debt. Your home county will then auction your property to the highest bidder, using the money to pay off the lien against the property. However, if any money is left after paying the lien and the costs of the foreclosure and sale, you may be entitled to claim it. These remaining funds are called the “excess proceeds.” Moreover, in some cases, if the foreclosure sale involves your home, you may have a “redemption period” where you can still recover your property if you repay the total amount of the judgment against you plus any taxes, fees, fines, or penalties.

Other States

However, it’s important to remember that every state handles the excess proceeds from a foreclosure property sale differently. For example, in Louisiana, foreclosures are typically handled via an auction, with any excess proceeds returning to the previous owner. However, Louisiana has no “right of redemption” after a foreclosure sale.

You Need an Experienced Surplus Funds Recovery Attorney

The process can be overwhelming if you’re going through a foreclosure sale in Texas. But you don’t have to figure this out alone. The seasoned attorneys at Manfred Law have been helping Texans unravel the bureaucratic process of recovering excess funds for years. Find out how they can help you. Call them at (713) 547-5460 or contact them online to schedule your consultation.