Understanding Right of Survivorship and Claims to Surplus Funds in New Mexico

Short answer: Possibly — if the deed clearly created a right of survivorship and title passed to you before distribution of surplus funds, you may be entitled to the share that belonged to the decedent. Whether you can get a larger share depends on the deed language, the timing of death versus the foreclosure or sale, recorded documents, and the county procedures for claiming surplus funds. This article explains how survivorship works, how surplus funds are distributed, what documents you will need, and practical steps to assert your claim in New Mexico.

How right of survivorship works (basic concept)

A right of survivorship is a way owners hold real property so that when one co-owner dies, the deceased owner’s interest automatically passes to the surviving owner(s) outside of probate. Key points:

Survivorship arises only if the deed contains clear language creating a joint tenancy or otherwise states the grant is “with right of survivorship,” “as joint tenants with right of survivorship,” or similar words showing the parties intended survivorship.
If the deed does not clearly create survivorship, many courts treat the ownership as tenants in common. In that case, the deceased owner’s share passes to heirs or devisees through probate, not automatically to co-owners.
If survivorship operated and title vested in the survivor before a sale or distribution, the survivor is treated as the owner of the property interest at the relevant time.

How surplus funds from a foreclosure or sheriff’s sale are typically handled

When a forced sale (like a foreclosure or sheriff’s sale) produces more money than is needed to pay liens and costs, the extra money becomes surplus (also called overage). Distribution rules vary by case and county procedure, but generally:

Senior lienholders and costs are paid first from sale proceeds.
Any remaining surplus typically belongs to the party who held the equity in the property immediately before the sale — usually the record owner or anyone with an equitable interest on the day of sale.
If an owner died before the sale and survivorship already transferred title to a co-owner, the survivor often is treated as the owner and has the claim to surplus.
If survivorship did not operate (for example, owners were tenants in common), the decedent’s interest may pass through probate and the executor or personal representative will be the proper claimant for the decedent’s share.

Key timing and record issues to check

The most important facts in any surplus claim are timing and the public records. Ask:

Did the co-owner die before or after the foreclosure sale date?
Does the recorded deed expressly create a right of survivorship?
Was the deed or an affidavit of survivorship properly recorded before the sale or before the surplus was distributed?
Who is listed as record owner in the county land records at the time the county disburses surplus funds?

How to assert a survivorship claim to surplus funds in practice

If you believe you are owed a larger share of surplus funds because you hold title with a right of survivorship, take these steps:

Obtain certified copies of the recorded deed(s). Look for explicit survivorship language. If the language is ambiguous, the deed may not create survivorship.
Get a certified copy of the decedent’s death certificate. County officials typically require a death certificate when a survivor asserts title by survivorship.
If available, prepare and record an affidavit of survivorship or an affidavit of death of joint tenant, following county recording office requirements. Recording helps make the chain of title clear to the sheriff/court handling surplus funds.
Gather county sale papers: sheriff’s deed or sale certificate, the foreclosure judgment, and the surplus notice (if any). Identify the court or county office handling the surplus (often the sheriff or district court clerk where the sale occurred).
File a formal claim for the surplus according to the county’s procedures. Some counties require claim forms; others require filing a motion in the foreclosure case or filing an interpleader response. Pay attention to deadlines — there are often short statutory or procedural windows to claim surplus funds.
If other parties also claim the funds (for example, creditors, heirs, or alleged co-owners), you may need to seek a declaratory judgment or participate in an interpleader action so a court can decide ownership.

Evidence you will likely need

Recorded deed showing language of survivorship or joint tenancy.
Certified death certificate for the decedent.
Affidavit of survivorship or other recorded affidavit (if prepared).
Records of the sheriff’s sale, foreclosure judgment, and any notices about surplus funds.
Title chain showing whether title was effectively transferred before the sale or distribution.

Common obstacles and disputes

You may face these issues when asserting a survivorship-based claim:

Ambiguous deed language. Courts will interpret deeds; ambiguous wording can defeat a survivorship claim.
Unrecorded documents. If the survivorship transfer was not recorded, the county might treat the record differently when dispersing funds.
Competing claimants. Heirs, creditors, or a probate personal representative may claim the decedent’s share.
Procedural deadlines. Missing the county’s claim deadline can forfeit your ability to recover surplus funds.

Typical next steps and when to get legal help

If you want to pursue a larger share of surplus funds based on survivorship, do the following quickly:

Collect and record the documents listed above.
Contact the sheriff’s office or court clerk that handled the sale to ask about the surplus claim process and deadlines.
If there is any dispute about whether the deed created survivorship or if competing claimants exist, consult a New Mexico real property attorney or probate attorney. They can file the correct motion or claim and represent you in court if an interpleader or declaratory-judgment action is needed.

Hypothetical example (illustrative)

Jane and Maria hold title “as joint tenants with right of survivorship.” Maria dies before the sheriff’s sale on a mortgage she and Jane signed. Maria’s death certificate is recorded. The sale later generates surplus funds. Because the deed created survivorship and title passed automatically to Jane before distribution, Jane can present the deed and death certificate to the sheriff or court and claim all of the equity that formerly belonged to Maria. If, by contrast, the deed said “to Jane and Maria” without survivorship language, Maria’s share likely passes to her heirs through probate and Jane could only claim her original half; the heirs might claim Maria’s half.

Helpful hints

Check the exact deed words. Survivorship must be clear in the recorded deed.
Record an affidavit of survivorship and the death certificate so county records reflect the change in ownership.
Act fast. Learn the county’s surplus-claim deadline and follow it.
Keep certified copies and originals of all recorded documents and sale paperwork handy.
If title language is unclear, get a title search to clarify who the record owner was at the time of sale.
Ask the sheriff or court clerk for the specific surplus-claim procedure in the county where the sale occurred — procedures vary by county.
When in doubt, consult a New Mexico real estate or probate attorney — a short consultation can clarify whether you have a viable survivorship claim and how to proceed.