What Happens to Surplus Funds If You Still Owe HOA or Condo Fees?

When a property goes through foreclosure, the money from the sale is used to pay off the debts tied to the property — like mortgages, taxes, or liens. But what happens if you still owe Homeowners Association (HOA) or condo fees? Many homeowners are surprised to learn that HOA and condo associations can affect who gets the surplus funds after a foreclosure. Here’s how it works — and how you can still recover what’s rightfully yours.

Understanding HOA and Condo Liens

When you own a home in an HOA or condo community, you’re responsible for paying monthly dues or assessments. If these payments fall behind, the HOA or condo association can place a lien on your property.

That lien gives them the right to collect unpaid dues — and in some cases, it can even lead to foreclosure. So, when your property is sold, the HOA or condo association is one of the parties that may be paid before you receive any surplus funds.

How HOA or Condo Fees Affect Surplus Funds

After a foreclosure sale, the sale proceeds are distributed in a specific order:

The primary mortgage lender or tax authority is paid first.
Secondary lienholders (such as HOA or condo associations) are paid next, if a valid lien was filed.
The homeowner receives any remaining balance — this is the surplus funds.

If you still owe HOA or condo fees, the association’s lien could reduce the amount you receive. However, once those debts are satisfied, any remaining surplus still belongs to you.

Why It’s Important to Know What Liens Exist

Even if your foreclosure was handled by the bank or county, you’re still entitled to the surplus after all debts are paid. That’s why it’s crucial to:

Check for outstanding HOA or condo liens before filing your claim.
Review your foreclosure documents to see who was paid from the sale.
Act quickly to claim your surplus funds before they are transferred to unclaimed property.

How Surplus Refund LLC Can Help

At Surplus Refund LLC, we help homeowners and heirs recover the funds they’re entitled to — even when HOA or condo fees are involved. Our team:

Reviews all foreclosure and lien records to determine how much you’re owed.
Communicates with the court or HOA to ensure your claim is properly handled.
Prepares and files your claim paperwork, so you don’t have to navigate the process alone.
Works to maximize your recovery by ensuring all valid debts are cleared first.

Don’t Let HOA Fees Stop You from Claiming Your Funds

Owing HOA or condo fees doesn’t mean you lose your right to surplus funds. Once all valid liens are paid, the remaining balance is still yours — and you deserve to receive it.