§ 3712. Disposition of sale proceeds

Statutory text

Money realized from a foreclosure sale shall be made available for obligation and expenditure—

first to cover the costs of foreclosure provided for in section 3711 of this title;

then to pay valid tax liens or assessments prior to the mortgage;

then to pay any liens recorded prior to the recording of the mortgage which are required to be paid in conformity with the terms of sale in the notice of default and foreclosure sale;

then to service charges and advancements for taxes, assessments, and property insurance premiums;

then to the interest;

then to the principal balance secured by the mortgage (including expenditures for the necessary protection, preservation, and repair of the security property as authorized under the mortgage agreement and interest thereon if provided for in the mortgage agreement); and

then to late charges.

Any surplus after payment of the foregoing shall be paid to holders of liens recorded after the mortgage and then to the appropriate mortgagor. If the person to whom such surplus is to be paid cannot be located, or if the surplus available is insufficient to pay all claimants and the claimants cannot agree on the allocation of the surplus, or if any person claiming an interest in the mortgage proceeds does not agree that some or all of the sale proceeds should be paid to a claimant as provided in this section, that part of the sale proceeds in question may be deposited by the foreclosure commissioner with an appropriate official or court authorized under law to receive disputed funds in such circumstances. If such a procedure for the deposit of disputed funds is not available, and the foreclosure commissioner files a bill of interpleader or is sued as a stakeholder to determine entitlement to such funds, the foreclosure commissioner’s necessary costs in taking or defending such action shall be deductible from the disputed funds.

Legislative history

Reconstructed from this section’s Code source credit and amendment notes, resolved against the local Statutes at Large. Editorial notes are evidence, not the law that made the change.

1981
Multifamily Mortgage Foreclosure Act of 1981
Pub. L. 97–35 title III § 369D · 95 Stat. 357
Enacted · 12 U.S.C. § 3712
(Pub. L. 97–35, title III, § 369D, Aug. 13, 1981, 95 Stat. 429.)
Source evidence
Code source credit
(Pub. L. 97–35, title III, § 369D, Aug. 13, 1981, 95 Stat. 429.)
Enacted provision · exact public law section
Sec. 369D. disposition of sale proceeds Money realized from a foreclosure sale shall be made 12 USC 3712. available for obligation and expenditure— (1) first to cover the costs of foreclosure provided for in section 369C; (2) then to pay valid tax liens or assessments prior to the mortgage; (3) then to pay any liens recorded prior to the recording of the mortgage which are required to be paid in conformity with the terms of sale in the notice of default and foreclosure sale; (4) then to service charges and advancements for taxes, assessments, and property insurance premiums; (5) then to the interest; (6) then to the principal balance secured by the mortgage (including expenditures for the necessary protection, preservation, and repair of the security property as authorized under the mortgage agreement and interest thereon if provided for in the mortgage agreement); and (7) then to late charges. Any surplus after payment of the foregoing shall be paid to holders of Surplus proceeds. liens recorded after the mortgage and then to the appropriate mortgagor. If the person to whom such surplus is to be paid cannot be located, or if the surplus available is insufficient to pay all claimants and the claimants cannot agree on the allocation of the surplus, or if any person claiming an interest in the mortgage proceeds does not agree that some or all of the sale proceeds should be paid to a claimant as provided in this section, that part of the sale proceeds in question may be deposited by the foreclosure commissioner with an appropriate official or court authorized under law to receive disputed funds in such circumstances. If such a procedure for the deposit of disputed funds is not available, and the foreclosure commissioner files a bill of interpleader or is sued as a stakeholder to determine entitlement to such funds, the foreclosure commissioner’s necessary costs in taking or defending such action shall be deductible from the disputed funds.

1 of 1 references resolved to an enrolled provision

Credits

(Pub. L. 97–35, title III, § 369D, Aug. 13, 1981, 95 Stat. 429.)