FAQ: How a right of survivorship in a deed affects claims to surplus funds after a sheriff’s sale in Indiana

Short answer

Possibly — but it depends on the exact language of the deed, whether the deed was effective and recorded before the foreclosure sale, whether the co‑owner died before or after the sale, and how title and liens were handled before distribution of surplus proceeds. A properly phrased right of survivorship can vest full legal title in the surviving co‑owner and therefore give that person a right to the surplus funds. If the deed did not create survivorship (for example, if ownership was a tenancy in common), the decedent’s heirs or estate may have an interest in the surplus.

Detailed answer — how this works under Indiana law

This explanation assumes a reader with no legal background. Below are the key legal points, how they apply in practice, and what you should do to preserve a claim.

1. Who owns the property when surplus funds are distributed?

Surplus proceeds from a sheriff’s sale are distributed to whoever holds the legal interest in the property at the time the sheriff/court determines distribution. That determination follows the chain of title, recorded liens, and the effect of any conveyances (including deeds that create a right of survivorship).

2. What is a “right of survivorship” and how is it created?

A right of survivorship is a form of ownership in which, when one co‑owner dies, the surviving co‑owner automatically becomes the sole owner of the entire interest — without that interest passing through the deceased person’s probate estate. In Indiana, the language of the deed controls: clear words creating a survivorship interest (for example, “as joint tenants with right of survivorship” or wording that clearly expresses an intent that the survivor take the whole) are the strongest evidence that title passes to the survivor at death.

3. Timing matters — did the co‑owner die before or after the sale?

If the co‑owner died before the sheriff’s sale and a valid survivorship interest existed, the survivor likely owned the decedent’s interest at the time of sale. If the surviving owner had full title at the time of sale, they generally have the superior claim to surplus proceeds. If the death occurred after the sale but before distribution of surplus, courts will look at who held title at the time of sale and whether the sale or foreclosure process already extinguished the decedent’s interest.

4. Foreclosure and severing of rights

Foreclosure of a mortgage or other lien can extinguish interests subordinate to the foreclosed lien. Which interests survive and who is entitled to any surplus depends on lien priority, recordings, and whether the deed’s survivorship language applied to the interest burdened by the lien. In some situations a foreclosure can destroy an equitable right of survivorship if the party holding the senior lien buys at the sale and title changes in a way that defeats the survivorship claim. Because this is fact‑specific, evidence of the recorded instruments and the timeline is crucial.

5. Practical proof and recordation

To assert a survivorship claim you must prove (a) the deed created a survivorship interest, (b) the deed was effective and properly recorded (or otherwise gave notice) before the relevant sale or lien priority dates, and (c) the survivor was the rightful owner when distribution was set. Certified copies of the deed(s), the chain of title from the recorder’s office, the death certificate, and the sheriff’s sale/court distribution documents are the core proof items.

6. Court process and claim deadlines

Surplus funds are typically handled by the sheriff or the court that supervised the foreclosure. Claimants usually must file a timely written claim or motion with the court or sheriff to be considered for distribution. Deadlines and procedures vary depending on the court and the foreclosing process; prompt action is essential. Consult the clerk of the court or sheriff’s office for procedural steps and any published timelines in that foreclosure matter.

What you should do next (practical steps)

1. Get a certified copy of the deed(s) from the county Recorder (now often called the Recorder or Surveyor/Recorder office). Confirm whether the deed language includes words indicating a right of survivorship.
2. Obtain a certified copy of the death certificate for the deceased co‑owner (if applicable).
3. Pull the county’s chain of title and all recorded liens and mortgages to see the order of recordings and priorities.
4. Check the sheriff’s sale paperwork and any court orders about surplus funds. Note any deadlines for filing a claim and the court that issued the foreclosure order.
5. If you believe you have a survivorship claim, file a written claim for the surplus with the sheriff or the court handling distribution and attach supporting documents. Consider requesting a hearing if the distribution is contested.
6. Consult an Indiana real property or foreclosure attorney promptly. Time limits and technical requirements can be short and mistakes may forfeit your rights.

Helpful hints

• Preserve originals and get certified copies: deeds, death certificates, and sheriff/court documents.
• Look for exact language in the deed: “with right of survivorship,” “joint tenants,” or similar phrasing is persuasive evidence that survivorship was intended.
• If the deed is ambiguous, Indiana courts look to the parties’ intent — but ambiguity makes winning a claim harder and often requires litigation.
• Recording dates matter: later recordings can be subject to earlier liens. Make a timeline of recordings, mortgage filings, and the sheriff’s sale.
• Act quickly: claims to surplus funds can have strict procedural requirements and deadlines in the foreclosure case.
• When in doubt, get an attorney: title disputes and surplus distributions can be legally complex and fact specific.

Where to look for Indiana statutes and local rules

Indiana’s legislature and courts publish statutes and local rules online. For general statute searches and to read relevant provisions about property, conveyances, and civil procedure, start at the Indiana General Assembly site: https://iga.in.gov/. For local foreclosure procedures or sheriff sale practices, check the county sheriff and county court clerk websites where the property is located.

Common outcomes

If the deed clearly created a survivorship interest and the survivor owned the decedent’s share when title was determined, the survivor has a strong claim to the surplus. If the deed did not create survivorship, or if the foreclosure process or timing extinguished the decedent’s interest, the surplus may go to the decedent’s estate or other lienholders. Many disputes are resolved by filing competing claims and letting the court decide based on documents and recorded title.

Final note and disclaimer

This article explains general principles and typical steps under Indiana property and foreclosure practice. It is educational only and is not legal advice. Facts change outcomes; only a licensed Indiana attorney who reviews your deeds, recordings, and court papers can advise you on the correct course of action for your situation.