California at a glance
Checked against the sources cited, 2026-09-19
| Topic | What the law says, and where it says it |
|---|---|
| How foreclosure works here | California allows foreclosure without a court case when the deed of trust or mortgage contains a power of sale: a notice of default is recorded, at least three months must pass, and a notice of sale is then given before the trustee's sale. A lender may instead file a court action to foreclose (judicial foreclosure). Cal. Civ. Code §2924(a)(1)-(3) (power of sale); Cal. Code Civ. Proc. §725a (court foreclosure) Show the source texta power of sale is conferred upon the mortgagee, trustee, or any other person, to be exercised after a breach of the obligation for which that mortgage or transfer is a security |
| Who holds foreclosure surplus | After a trustee's sale the trustee holds any money left once the sale costs and the foreclosed loan are paid. Within 30 days after the trustee's deed is signed, the trustee must mail a notice to everyone with a recorded interest in the property, and it then pays claims in order: junior lienholders by priority, then the former owner (the trustor, or the owner of record at the time of the sale if the property had been transferred). If the trustee cannot resolve competing claims it may deposit the money with the clerk of the superior court in the county of the sale, or file an interpleader action, and the court distributes it; a deposit of $35,000 or less is handled as a limited civil case. Cal. Civ. Code §2924j(a)-(e); Cal. Civ. Code §2924k(a) Show the source textIn the event there is no dispute as to the priority of the written claims submitted to the trustee, proceeds shall be paid within 30 days after the conclusion of the notice period. |
| Claim window for foreclosure surplus | A written claim must reach the trustee no later than 30 days after the date the trustee sends its notice. If the trustee deposits the money with the court, its notice of the deposit must say that a claim has to be filed with the court within 30 days from the date of that notice. The statute adds that it does not stop anyone from pursuing other remedies or claims to surplus proceeds, and a trustee holding surplus that is not deposited with the court must comply with the Unclaimed Property Law to the extent it applies. Cal. Civ. Code §2924j(a)(4)(C), (b), (d), (g) Show the source textThat claims must be received by the trustee at the address stated in the notice no later than 30 days after the date the trustee sends notice to the potential claimant. |
| Tax sale excess proceeds | California is a tax deed state: the county tax collector may sell tax-defaulted property itself, generally five years or more after the default. Excess proceeds are kept in the county's delinquent tax sale trust fund, and a party of interest (lienholders of record first, then the person who held title) may file a claim with the county up to one year after the tax collector's deed to the buyer is recorded; a mailed claim must be postmarked by that date. Excess proceeds that are not claimed may then be transferred to the county general fund. Cal. Rev. & Tax. Code §4675(a), (e); §4674; §3691(a)(1)(A) Show the source textat any time prior to the expiration of one year following the recordation of the tax collector's deed to the purchaser |
| Redemption after the sale | California's redemption statute applies to court-ordered (judicial) foreclosure sales where the judgment allows a deficiency: the property may be redeemed within three months after the sale if the sale proceeds were enough to pay the secured debt with interest and costs, or within one year if they were not. It provides no redemption period after an ordinary trustee's sale under a power of sale; the one out-of-court sale it covers is a homeowners association's foreclosure for unpaid assessments, which can be redeemed within 90 days after the sale. Cal. Code Civ. Proc. §729.010(a), §729.030, §729.035; Cal. Civ. Code §5715(b) Show the source textThree months after the date of sale if the proceeds of the sale are sufficient to satisfy the secured indebtedness with interest and costs of action and of sale. |
| Rules for recovery companies | California's Mortgage Foreclosure Consultants Act makes it a violation for a foreclosure consultant to enter into any agreement to help an owner obtain the release of surplus funds after a trustee's sale, whether by direct payment, assignment, deed, power of attorney or any other compensation. A person who does this for compensation for the owner of an owner-occupied home of one to four units in foreclosure is a foreclosure consultant unless he or she is the owner's attorney. For tax sale excess proceeds, anyone filing for a claimant must submit proof that the claimant was told the amount and source of the money and the right to claim it directly from the county at no cost. For property held by the State Controller, a recovery agreement may not charge more than 10 percent of the recovered property and may not require any fee before the Controller approves and pays the claim. Cal. Civ. Code §2945.4(h); §2945.1(a)(9), (b)(1), (c), (e)(8); §2945.7; §1695.1(b), (f); Cal. Rev. & Tax. Code §4675(b), (c); Cal. Code Civ. Proc. §1582(a) Show the source textEnter into an agreement at any time to assist the owner in arranging, or arrange for the owner, the release of surplus funds after the trustee's sale is conducted |
How surplus funds arise in California
When a home in California is sold at a foreclosure sale or a tax sale for more than the debt and the costs of the sale, the money left over is surplus funds, also called excess proceeds or overage. It does not belong to the lender or to the buyer. Liens recorded behind the foreclosed debt are paid first, and what remains belongs to the former owner or to the owner's heirs. Read surplus funds explained for the general rules and liens and competing claims for the order of payment.
How a claim moves in California
We confirm the sale figures in the public record, identify which office in California is holding the money, and prepare and file the claim the way that office requires, advancing the costs. Because we bring the whole record with us, the claim does not stall on a missing document, a competing name or a missed date. See how to qualify for what we handle and what you provide. Notices about surplus are usually mailed to the last address on record, which is often the home that was sold, so do not wait for a letter. In California that program is the California State Controller's Unclaimed Property Program (Unclaimed Property Division, State Controller's Office).
If the owner has died
The right to the money belongs to the estate. Depending on the size of the estate, California law may allow a simplified procedure, or a probate court may need to appoint a personal representative. See estate and heir recovery and probate assistance.
Working with a recovery company in California
California regulates this kind of service. California's Mortgage Foreclosure Consultants Act makes it a violation for a foreclosure consultant to enter into any agreement to help an owner obtain the release of surplus funds after a trustee's sale, whether by direct payment, assignment, deed, power of attorney or any other compensation. A person who does this for compensation for the owner of an owner-occupied home of one to four units in foreclosure is a foreclosure consultant unless he or she is the owner's attorney. For tax sale excess proceeds, anyone filing for a claimant must submit proof that the claimant was told the amount and source of the money and the right to claim it directly from the county at no cost. For property held by the State Controller, a recovery agreement may not charge more than 10 percent of the recovered property and may not require any fee before the Controller approves and pays the claim. (Cal. Civ. Code §2945.4(h); §2945.1(a)(9), (b)(1), (c), (e)(8); §2945.7; §1695.1(b), (f); Cal. Rev. & Tax. Code §4675(b), (c); Cal. Code Civ. Proc. §1582(a))
Any agreement you sign, with us or with anyone else, has to follow that rule.
In California, claims by a former owner-occupant of a home sold at a trustee's sale are handled by a licensed California attorney, because California law reserves that work for the owner's attorney (Cal. Civ. Code §2945.4).
No out-of-pocket expense. Our only payment is a completion fee taken from the surplus once it is recovered. Where your state requires a licensed attorney for a court or probate filing, a licensed attorney handles it, and you still pay nothing out of pocket. Before you sign with anyone, read what a surplus funds scam looks like.
Questions about surplus funds in California
Enough to prove who you are and how you held the property: identification, the deeds, any notice you received, and, if the owner has died, the estate paperwork. We do the rest for California, from locating the funds to filing the claim.
After a trustee's sale the trustee holds any money left once the sale costs and the foreclosed loan are paid. Within 30 days after the trustee's deed is signed, the trustee must mail a notice to everyone with a recorded interest in the property, and it then pays claims in order: junior lienholders by priority, then the former owner (the trustor, or the owner of record at the time of the sale if the property had been transferred). If the trustee cannot resolve competing claims it may deposit the money with the clerk of the superior court in the county of the sale, or file an interpleader action, and the court distributes it; a deposit of $35,000 or less is handled as a limited civil case.
No out-of-pocket expense. We advance the costs and are paid a completion fee from the surplus only after it is recovered. Where a court or probate filing requires a licensed attorney, a licensed attorney handles it.