When a homeowner defaults on a mortgage or doesn't pay property taxes, a mortgage lender, taxing body, or holder of a tax certificate may legally foreclose on the home and sell it. Frequently, the foreclosure auction is unable to produce enough money to cover the entire amount owed, leaving a deficiency for which the homeowner is usually still responsible.

However, occasionally a home will sell for more than the amount owed on a mortgage or the amount of a tax lien, especially when the housing market is hot. The homeowner might then be entitled to the extra money raised. Sadly, getting that surplus is not a simple procedure. The homeowner must instead request that the court in charge of the foreclosure distribute the surplus to them.

Depending on the type of foreclosure, if this is not done in a timely manner, the unclaimed foreclosure proceeds may be moved to the government and held there permanently or forfeited outright. Therefore, it is essential for homeowners to act immediately in order to acquire any surplus funds left over following a foreclosure sale.

Ohio law outlines the order in which the proceeds from a foreclosure sale are applied. Depending on the type of foreclosure and the terms of the mortgage in the case of a mortgage foreclosure, different specifics apply. Typically, the money will be utilized to cover the costs of the foreclosure case first. The remaining sum on the mortgage or tax lien will then be deducted from the funds. Any additional funds will then be used to settle any junior liens or outstanding taxes, if any. 

The surplus will be handled by the overseeing government agency in a mortgage foreclosure. They will make an effort to inform the owner of the surplus that the money is now available according to O.R.C. 2329.44

The government will post another notice in the newspaper or online 90 days after the date of the first notice. If the money is still unclaimed after another 30 days, the government will give it to the treasurer.

If a person does not answer in a timely manner, some Ohio courts have stated that the person would forfeit their entitlement to the surplus funds. It is imperative to move quickly when you have funds available. 

The court that managed the foreclosure procedure receives the surplus in a tax lien foreclosure. The owner of the funds may submit a motion to disperse them during that time. 

If the money is still unclaimed after 60 days, the court gives it to the treasurer, who holds it in the name of the "alleged owner." The former homeowner who is entitled to the unclaimed foreclosure funds has three years to request payment from the treasurer. The money is forfeited three years after the date the surplus was given to the treasurer. 

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