Detailed Answer — Recovering Surplus (Excess) Proceeds After a Colorado Foreclosure

Short answer: In Colorado, if a foreclosure sale produced money in excess of what was required to pay the mortgage and other senior liens, a person entitled to that surplus must file a verified claim (a special proceeding or petition for distribution) in the court or county office that holds or controls the sale proceeds, serve the required parties, and obtain a court order directing distribution. The process requires clear proof of your entitlement, timely action, and notice to other claimants.

Basic legal background (what the law says)

Foreclosure of mortgages, deeds of trust, and other security interests is governed by Colorado Revised Statutes, Title 38 (mortgages and foreclosures). The statutes and related court rules determine who gets money left over after a sale, who must be notified, and the procedure for distributing surplus funds. For general reference to Colorado statutes, see the Colorado General Assembly statutes page: Colorado Revised Statutes. For court forms and procedural guidance, see the Colorado Judicial Branch: courts.state.co.us.

Step-by-step: How to file a special proceeding to recover foreclosure surplus funds in Colorado

Confirm there is a surplus and where it is held.
- Get a copy of the foreclosure sale paperwork (trustee’s/sheriff’s deed, certificate of sale, sale accounting). These show the sale price, how funds were applied, and whether there is an excess (surplus) after liens and costs.
- Find which office currently holds the surplus (trustee, sheriff, clerk of court, or county treasury). Often the trustee or sheriff will hold surplus temporarily or deposit it with the county. The sale documents should say.
Determine who may claim the surplus and any deadlines.
- Typical priority: sale surplus usually pays junior lienholders, then the foreclosed owner (former borrower), then other claimants in priority order. Look at the chain of title and recorded liens.
- Act promptly. There may be statutory or practical deadlines after which the county or trustee will require a court order or will dispose of funds under established procedures.
Gather supporting documents proving your right to the surplus.
- Photo ID; proof of identity and relationship to the property.
- Title documents showing you are the owner or successor-in-interest (deed, probate documents, trust documents, assignment of interest).
- Copies of the foreclosure sale record (advertisement, affidavit of sale, trustee’s deed/sheriff’s deed, sale accounting showing surplus amount).
- Records of liens and payoff statements showing priority and amounts remaining at sale.
Prepare a verified petition or claim for distribution (special proceeding).
- Title the document as a petition, verified claim, or special proceeding to determine and distribute surplus proceeds from the foreclosure sale. Identify the county and case or sale reference.
- State your legal interest in the property (owner, heir, lienholder, assignee), the amount of surplus you claim, and attach supporting exhibits (deed, sale accounting, IDs).
- Request relief: that the court determine entitlement and enter an order directing payment of the specified amount to you.
File the petition in the correct court or office and pay the filing fee.
- File in the court having jurisdiction over the foreclosure or the county where the property is located. In many counties this is the district court or county court where the sale took place—check local practice or talk to the clerk.
- Some counties have specific procedures or forms for surplus funds claims. Check the county court clerk’s office or the Colorado Judicial Branch forms page for a claim-for-surplus form.
Serve (give notice to) all required parties.
- Serve the trustee/sheriff who conducted the sale, the purchaser at sale, all recorded lienholders (especially those that were paid or remain unpaid), and any party that could claim the surplus.
- Follow Colorado rules for service (personal service or certified mail as required). The court clerk or local rules will specify proper service methods and timelines.
Publish notice if required.
- If the court or local rules require publication (to reach unknown claimants), publish a notice of the petition in a qualified newspaper for the prescribed time and file proof of publication.
Attend the hearing and obtain a court order.
- The court will schedule a hearing. Be prepared to present evidence proving your entitlement and the correct amount.
- If no one contests, the court may grant a default order and direct distribution. If contested, the court decides based on priorities and proofs.
Collect the funds after the order.
- After you obtain an order, the county or trustee will release funds to you per the court order. You may need to provide a W-9, identification, or an affidavit before the check is cut.
- If the funds have been deposited with the county treasurer, follow the county’s disbursement procedures.
If someone appeals or disputes the claim
- A dispute can prolong recovery and may require full litigation on title or lien priority. If contested, consider hiring an attorney experienced in Colorado foreclosure and real property law.

Common documents and checklist

Verified petition or claim form
Copy of deed showing ownership
Foreclosure sale documents (trustee’s deed or sheriff’s deed, sale accounting)
Chain of title and lien records (recorded mortgages, assignments, releases)
Government-issued photo ID and W-9
Affidavits or proof of service and publication
Any probates or trust documents if claiming as heir or trustee

Timing, costs, and practical points

Filing fees and service costs vary by court and county. Expect administrative delays if the surplus is modest or the case is contested.
If multiple parties claim the same funds, the court will determine priority; you may get only part of the amount or none at all.
Sometimes the trustee or county requires claimants to sign releases or indemnities before disbursing funds; review those carefully.
Consider getting title or lien searches to be sure you know all possible competing claimants before you file.

Helpful Hints

Start early: locate and copy the sale accounting right away. Delay can make recovery harder.
Keep clear, dated records of every step: whom you served, when, and how.
Contact the trustee or sheriff first to learn where the money sits and any local procedural requirements.
Check county court websites for local forms or instructions — some counties provide a standard surplus claim form.
If you lack documentary proof of ownership (e.g., missing deed), obtain certified copies from the county records office before filing.
If amounts are small, weigh filing costs against likely recovery; however, statute of limitations and local rules can bar late claims.
If anyone else claims an interest (heirs, assignees, lienholders), consider mediation or counsel to avoid costly litigation.

When to consult an attorney

Consider consulting a Colorado attorney if your claim is contested, if multiple lienholders exist, if the title is complicated (trusts, probates, multiple owners), or if the surplus is large enough to justify legal fees. An attorney can draft the petition, handle service and litigation, and protect your priority rights.

References and where to look for forms and rules

Colorado Revised Statutes, Title 38 (mortgages and foreclosure topics) — Colorado General Assembly: https://leg.colorado.gov/colorado-revised-statutes
Colorado Judicial Branch (court forms and local court contacts): https://www.courts.state.co.us
County court clerk or recorder where the property sits — for local procedures, forms, and fees (search the county website or call the clerk).

Disclaimer

This article explains general steps to seek surplus foreclosure funds in Colorado. It does not constitute legal advice. Laws and local procedures change. For advice about your specific facts and to ensure compliance with Colorado statutes and local court rules, consult a licensed Colorado attorney.