Detailed Answer
In New Hampshire, a foreclosure sale often generates more money than needed to cover the mortgage debt, costs, and senior liens. Any remaining balance—known as surplus funds—goes into the custody of the Superior Court in the county where the property lies. Under RSA 479:24, the foreclosing party must file a detailed report of sale proceeds and a proposed distribution list with the court clerk. This report becomes a public record.
To determine whether surplus funds remain, an interested party (for example, the former owner or a junior lienholder) should follow these steps:
- Review the sale report. Obtain a copy of the trustee’s or foreclosing party’s report of sale and distribution filed with the court clerk. This document shows gross sale proceeds, fees, costs, and liens paid in order of priority under RSA 479:24 (RSA 479:24).
- Check court records. Contact the clerk of the Superior Court in the county where the foreclosure occurred. Ask for entries under the foreclosure case number or property address. The clerk’s register will indicate any funds held as overplus.
- Consult the Registry of Deeds. Look for a certificate of sale or deed recorded after foreclosure. The Registry of Deeds entry may note the clerk’s case number and any reference to surplus funds.
- Search public notices. Foreclosure sales and notices to claim surplus funds often appear in local newspapers or the county’s online foreclosure docket. These notices list deadlines and contact details.
- Contact the foreclosing attorney or trustee. If you know which attorney or trustee handled the sale, request a copy of the distribution statement directly. They must disclose whether excess proceeds remain.
If a surplus exists, any claimant must file an application for distribution with the Superior Court under RSA 479:24. The application should include:
- Your name and address.
- Description of your interest (e.g., former owner, junior lienholder).
- Copy of the recorded foreclosure deed and sale report.
- Proof of any junior lien or equity interest.
The court typically requires a surety bond equal to double the claimed surplus, unless waived. After proper notice to senior lienholders and any other claimants, the court issues an order directing the clerk to disburse funds.
Helpful Hints
- Start early: Statutes of limitation may bar claims after 3 years from the sale date.
- Keep copies: Record all foreclosure documents, notices, and correspondence.
- Verify priorities: Senior liens get paid first; junior liens only get surplus if funds remain.
- Hire counsel: An attorney can draft the application and navigate court rules efficiently.
- Monitor deadlines: Missed filing or bond deadlines can forfeit your right to surplus.