12 U.S.C. § 3762 : US Code - Section 3762: Disposition of sale proceeds

Search 12 U.S.C. § 3762 : US Code - Section 3762: Disposition of sale proceeds

(a) Priority payments
Money realized from a foreclosure sale shall be made available
for obligation and expenditure in the following order:
(1) Costs of foreclosure
To cover the costs of the foreclosure proceeding described in
section 3761 of this title.
(2) Tax liens
To pay valid tax liens or assessments if required by the notice
of default and foreclosure sale.
(3) Prior liens
To pay any liens recorded before 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) Service charges and advances
To pay service charges and advances for taxes, assessments, and
property insurance premiums.
(5) Interest
To pay any outstanding interest.
(6) Principal
To pay the principal outstanding 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).
(7) Late charges or fees
To pay any late charges or fees.
(b) Other payments
(1) Other lienholders and the mortgagor
Any surplus of proceeds from a foreclosure sale, after payment
of the items described in subsection (a) of this section shall be
paid in the following order:
(A) First, to holders of liens recorded after the mortgage in
the order of priority under Federal law or the law of the State
in which the security property is located.
(B) Second, to the appropriate mortgagor.
(2) Disputed claims
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 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 incurred in taking or defending such action shall
be deductible from the disputed funds.