In Arizona, when a home forecloses, the law states that the home must be sold by trustee sale. A trustee sale is similar to an auction. A trustee will be assigned to the sale by the lender or "beneficiary." The trustee will conduct the auction at a pre-determined time and date where buyers may bid on the home. The winning bidder may then purchase the home for the winning price. The foreclosing lender will then be paid that money in consideration for their release of the deed of trust held against that property.
However, there may be more than one lender holding a deed of trust or other type of lien against the same property. Those second or third or more position lenders are left with nothing from the sale of the property, unless there are excess proceeds from the sale. Excess proceeds are monies that are over and above what the foreclosing lender received from the sale. For example, a home has a first mortgage of $100,000. The home forecloses at a trustee sale when the first mortgage holder conducts the sale. At the trustee sale, bidders have increased the sale price to $120,000. A final bidder buys the property for $120,000. The first lender collects its $100,000 as first mortgage holder of the trustee sale. What happens to the extra $20,000? Junior lien holders and the property owner have a right to ask the court for some or all of this money depending on how much each junior lien holder was entitled to receive. The "left-over" $20,000 is called Excess Proceeds.
Junior lien holders and the property owner have the right to file a claim for the excess proceeds. In most cases, the trustee from the sale will deposit the excess proceeds with the Treasurer. In Maricopa County, the Maricopa County Treasurer will hold the excess proceeds pending applications for distribution of the money. Junior lien holders and the now former property owner have the right to file an application for their share of the excess proceeds pursuant to Arizona Revised Statutes Section 33-812.
Filing an excess proceeds application takes knowledge of the law and the ability to obtain the documentation necessary to receive a determination from a judge that you are a bonafied applicant entitled to some or all of the excess proceeds. The court will hold evidentiary hearings to determine each applicant's eligibility.
Many times, homeowners do not know what the property sold for at the trustee sale. And, even if they do know, some do not know how to obtain those proceeds or whether they are entitled to that money. Many homeowners believe the lenders will just keep all the money and there's no way for them to get their share. This is just not true. With our help, we can get you what is owed to you from the sale of your home. Remember, you must have been the homeowner at the time the home was sold to be entitled to any excess proceeds. If you believe you were the homeowner, and there were excess proceeds, call us immediately to get your application filed. You typically only have two years to submit your application from the date the home was sold.
Once you have hired us to get your money, we will:
If you don't ask for your portion of the excess proceeds, the money will escheat to the State. Why leave your money on the table only to be given to the State, if you don't ask for it? Hire us to go to court for you. Isn't bad enough your home foreclosed? Don't let your money be wasted. We will get your money!
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