I Got a Surplus Funds Letter—Now What? Is It Even Real?!

If you’ve received a letter from the clerk’s office about surplus funds, your first thought might be, “Is this a scam?” The short answer: No, it’s real—and it could mean you're entitled to money left over from a foreclosure sale.

What Are Surplus Funds?

Surplus funds arise when a foreclosed property is sold at auction for more than the amount owed. After the mortgage, taxes, and legal fees are paid, any remaining funds are called surplus funds. These funds may legally belong to the former property owner or their heirs.

Many people are surprised:

“How could there be any money left over?” “Why would they give it to me?”

But it happens more often than you'd think. In especially in competitive real estate markets, the surplus funds could be substantial.

Yes, These Letters Are Real

In North Carolina, the clerk of court is required to notify known owners, or their heirs, when surplus funds are available. These notices are legitimate, and if you receive one, it’s important to act quickly. The clerk’s office cannot hold these funds forever—eventually, unclaimed surplus money is turned over to the state. Retrieving the surplus funds from the state is not impossible, but it is more difficult.

What to Do If You Receive a Surplus Funds Letter

To claim the funds, you’ll need to file a petition with the court. The process is governed by North Carolina surplus funds laws, and you’ll need to:

• Provide proof of ownership or heirship
• Submit all required documentation
• Notify any other parties who may have a legal claim (e.g., co-owners, other heirs, or creditors)

The court will hold a hearing to determine whether you’re entitled to receive some or all of the surplus funds.

Why You Should Consider Hiring an Attorney

While it’s possible to file a petition on your own, the process can be legally complex. By hiring an experienced North Carolina attorney, you can:

• Ensure your petition is complete and accurate
• The supplemental information is sufficient for the court
• Avoid delays in the disbursement of funds
• Increase your chances of receiving your share of the surplus

Final Thoughts: Don’t Miss Out on Surplus Funds

If you’ve received a surplus funds letter in North Carolina, don’t ignore it. You may be entitled to a financial recovery—but you must act before the funds are sent to the state to ensure a faster process.