How to recover surplus sale proceeds from a foreclosed home of a deceased parent (Kentucky)

Detailed Answer

This guide explains, in plain language, how to try to recover surplus (also called overage or excess) funds after a foreclosure sale of a deceased parent’s property in Kentucky when the parent’s estate was never opened in probate. It assumes no prior legal knowledge and walks you through the most common steps.

What are “surplus funds” after a foreclosure?

When a court-ordered foreclosure sale brings in more money than needed to pay the mortgage, fees, and court-ordered costs, the leftover money is the surplus. The surplus legally belongs to the owner of the property (the deceased parent) or, if the owner has died, to that person’s estate and rightful heirs.

Where to start: confirm whether a surplus exists and who holds it

Locate the foreclosure case file in the circuit court where the property was foreclosed. The foreclosure will usually have a case number and a master commissioner’s sale report showing sale price and distribution of proceeds. Call or visit the county circuit clerk’s office for that information.
If a surplus exists, the court or the clerk’s office (or master commissioner) will be holding the funds in the court registry or otherwise documenting them in the case file. The county circuit clerk or master commissioner’s office can tell you whether funds remain and how they are being held.
If you cannot find the case, search by the decedent’s name and the property address at the local circuit court clerk’s office or online case search (if available).

Who is entitled to the surplus?

Because the homeowner is deceased, the surplus belongs to the decedent’s estate and therefore to whoever is legally entitled under Kentucky succession law. That typically means a personal representative (executor or administrator) must receive the funds and distribute them to heirs according to the will or intestacy rules.

Options if the estate was never probated

If no probate administration was opened after your parent’s death, you generally have two practical routes to recover the funds:

Open probate (recommended in many cases).

File a petition in the appropriate circuit court to open administration of the decedent’s estate and ask to be appointed personal representative (administrator) or have the named executor appointed. Once appointed, the personal representative can file a motion or request in the foreclosure case or with the court holding the funds asking that the surplus be paid to the estate for distribution to heirs.
Claim the surplus directly in the foreclosure case if the court permits.

Some courts allow heirs to claim surplus funds by filing a motion or claim in the foreclosure case and proving their right to the money (heirship affidavits, death certificate, identification). If a court accepts an heir’s claim without full administration, it may order payment to that heir. However, many courts prefer funds be paid to an appointed representative of the estate to ensure proper distribution and to protect the court from competing claims.

Documents and proof you will typically need

Certified copy of the decedent’s death certificate.
Certified copies of the foreclosure case docket entries and master commissioner’s report showing the surplus (available from the circuit clerk).
Proof of your relationship to the decedent (birth certificate, marriage certificate, family tree, or other documents showing heirship).
If you claim as personal representative: letters testamentary or letters of administration issued by the court.
If no probate: an affidavit of heirship or other sworn statement establishing who the heirs are (some courts accept these; others require formal administration).
Photo ID for the claimant and contact information.

Typical procedure — step by step

Contact the circuit clerk’s office where the foreclosure occurred. Ask whether surplus funds exist, how they are being held, and what the clerk needs to process a claim. Get the foreclosure case number and copies of the sale report and distribution order.
Decide whether to open probate. If the estate has other assets or multiple heirs or if the clerk requires administration before release of funds, file for appointment as administrator in the county where the decedent lived. The clerk can explain local filing steps and forms. If the decedent left a will, the named executor should present it to the court.
If you do not open probate, speak with the clerk and the judge’s staff about filing a motion in the foreclosure case. Prepare supporting documents (death certificate, heirship affidavit, IDs). Some courts will direct payment only to an appointed administrator; others may release to heirs after an evidentiary showing of entitlement.
If the clerk or court requires more formal proof or there are competing claims, the court may schedule a hearing. Be prepared to appear and present evidence of heirship and entitlement.
If you are awarded the funds, the court will issue an order directing the clerk or master commissioner to pay the surplus to the personal representative or approved claimant. After collection, the personal representative distributes funds according to the will or Kentucky intestacy rules if no will exists.

What if you cannot locate funds or the court says the funds are unclaimed?

If the court’s records show the funds were deposited with the court registry and later not claimed, funds may eventually become unclaimed property. Kentucky has an unclaimed property program administered by the State Treasurer, which handles property turned over to the state. If you cannot recover funds through the court, check the Kentucky State Treasurer’s unclaimed property database online.

Search the Kentucky unclaimed property site here: Kentucky State Treasurer — Unclaimed Property

When to consider hiring an attorney

Consider hiring a local probate or real estate attorney if:

There are multiple heirs or disputes about who is entitled to the funds.
The court or clerk requires formal probate and you need help preparing and filing estate papers.
The amount of surplus is substantial and you want to make sure distribution follows Kentucky law and that you receive the correct net amount.
You face deadlines, complex filings, or difficulties obtaining records from the clerk’s office.

Where to get more local information

Contact the circuit clerk’s office in the county where the property was located. They hold foreclosure dockets and local instructions for claiming funds.
Use the Kentucky Court of Justice website for contact and court information: kycourts.gov.
For general state statutes and probate law reference, see the Kentucky Legislature site: Kentucky Revised Statutes (searchable).

Important note: laws and local court procedures vary by county and can change. The information above explains the common process and options but is not a substitute for legal advice tailored to your facts.

This is educational information and not legal advice. For help with specific filings, deadlines, or contested claims, consult a licensed Kentucky attorney who practices probate or real property law.

Helpful Hints

Start at the circuit clerk’s office — they hold the foreclosure file and the quickest answers about whether a surplus exists.
Gather a certified death certificate early — courts require it to establish the owner’s death and trigger estate procedures.
If possible, obtain certified copies of the master commissioner’s sale report and the court’s order of distribution — these documents show the surplus amount and who the court named to receive funds.
If you will open probate, bring originals or certified copies of the will (if there is one), a list of assets and creditors, and contact information for heirs.
Ask the clerk whether the county has any local forms or a preferred affidavit of heirship format. Using the court’s preferred form can speed processing.
Don’t delay: if surplus funds sit unclaimed, they can become harder to retrieve and may be subject to escheat/unclaimed property rules.
If multiple family members claim the same funds, consider mediation or a lawyer to avoid costly court fights.
When communicating with court staff, write down names, dates, and next steps — clerks are helpful but busy, and clear records reduce confusion.

Resources:

Kentucky Court of Justice: https://kycourts.gov
Kentucky Legislature statutes search: https://apps.legislature.ky.gov/law/statutes/
Kentucky State Treasurer — Unclaimed Property: https://treasury.ky.gov/collections/Pages/Unclaimed-Property.aspx