Detailed Answer

When a municipality forecloses for unpaid property taxes and sells the property, the sale proceeds first cover the unpaid taxes, interest, fees, and sale costs. Any remaining money—the surplus or excess proceeds—belongs to people with superior legal or equitable claims to the property: the former owner of record, recorded lienholders (for example, mortgagees), and, in some cases, heirs or an estate representative.

Massachusetts statutes governing municipal tax taking and sale are found in Chapter 60 of the Massachusetts General Laws. See the chapter overview here: Mass. Gen. Laws ch. 60. Relevant provisions describe the taking, sale, and distribution of sale proceeds; a reading of the chapter will help you confirm the municipality’s procedures and priorities.

Who is entitled to the surplus?

• The record owner at the time of sale (or the owner at the time taxes became delinquent) typically has the primary claim.
• Recorded lienholders (mortgagees, judgment lienholders) may have priority to all or part of the surplus to satisfy their liens.
• If the owner is deceased, the owner’s estate or legally appointed personal representative (executor/administrator) must usually claim the funds for the estate or distribute them to heirs under probate law.

Practical steps to claim surplus funds

1. Confirm whether a surplus exists. Ask the city or town treasurer/collector for the sale accounting. The treasurer’s office keeps the sale records and can tell you whether proceeds exceeded taxes and costs.
2. Identify who may claim the money. Determine whether you are the record owner, an heir, or an estate representative. If the owner is deceased, you will usually need formal probate appointment documents (letters of testamentary or appointment) to claim funds on behalf of the estate. Massachusetts Probate & Family Court information: mass.gov – Probate & Family Court.
3. Gather documentation. Typical documents the treasurer will require include proof of identity, deed or recorded ownership documents, recorded mortgage or lien documents (if you are a lienholder), and, where applicable, a death certificate and probate letters showing you are the personal representative. If you are an heir but there is no formal probate, ask the treasurer what they will accept—some towns require a small estate affidavit or a court order.
4. Submit a written claim to the municipal treasurer/collector. File a written request for the surplus with the treasurer (or the office designated in the sale notices). Attach certified copies of the documents above. Keep certified copies and a record of delivery (certified mail or hand-delivery receipt).
5. Expect municipal processing time. The treasurer will review competing claims and may contact recorded lienholders. This can take weeks to months depending on the municipality’s procedures and whether other claimants appear.
6. If the municipality rejects the claim or competing claims exist, consider filing a court action. If the treasurer declines to release funds or multiple claimants dispute entitlement, you may need to ask a court to determine who is entitled to the surplus. This frequently involves filing a civil action in Superior Court or seeking an equitable accounting; specific remedies depend on the facts and competing interests. Chapter 60 describes municipal sale procedures and priorities; consult it for details: G.L. c. 60, § 77 and related sections in Chapter 60: G.L. c. 60, § 79.
7. If the owner is deceased and no one claims the funds, a probate or court proceeding may be required. Municipalities will not always release funds without a clear, legally sufficient claimant. If the estate is open, the personal representative should handle the claim. If there’s no estate administration, heirs may need to pursue a probate appointment or obtain a court order establishing entitlement.

Key timeline and priority concerns

Time limits and priorities vary by situation:

• Municipal sale notices and statutory redemption periods (if any) are governed by Chapter 60 procedures; review the notice you received or the sale docket for deadlines.
• Recorded mortgages and other liens may have priority and can consume all surplus proceeds. A title search or review of recorded instruments at the Registry of Deeds will show outstanding liens.
• If you are an heir, act promptly. Municipalities may place unclaimed surplus into a custody account or follow procedures for unclaimed property under local rules.

When to consult a lawyer

If the municipality refuses to release funds, multiple parties claim the same surplus, or the ownership/estate issues are complex, speaking with a Massachusetts attorney who handles tax foreclosures, probate, or real estate disputes will help you evaluate options and, if necessary, bring a court action to recover the funds. If you need help finding counsel, consider the Massachusetts Bar Association or local court-based attorney referral services.

Helpful Hints

• Contact the city/town treasurer/collector first. They hold the sale accounting and will tell you whether surplus exists and what documents they require.
• Bring certified copies of all documents (deeds, mortgage records, death certificate, probate letters). Municipal offices often require certified or notarized copies.
• Check the Registry of Deeds for recorded liens. Surplus commonly goes to mortgagees and lienholders before the former owner.
• If the owner has died, obtain letters of administration or testamentary from Probate Court before asking for funds on behalf of the estate.
• Keep a detailed paper trail: copies of mailed claims, receipts, and emails. These help if you have to file a court action.
• Ask the treasurer whether there is a local form or an official claim checklist—many towns provide one for surplus-claim processing.
• If you cannot afford a private lawyer, contact Massachusetts Legal Aid organizations or local law clinics for guidance on probate or surplus claims.