When a surplus claim is a form filed with the clerk or the county, you may never need a lawyer. You find the former owner, sign the agreement, gather the documents, and file. But some files can't be finished that way. The claim has to go in by court motion, two heirs want the same money, a junior lienholder pushes back, or the state limits what a non-attorney can be paid. When that happens, the file depends on an attorney you trust in that state.
This guide is for people who run surplus funds recovery businesses: when a file needs an attorney, where to find attorneys who already file surplus motions, how to vet them, how fee rules affect the work, and how to build a bench in each state you work.
Note: This is general information, not legal advice. Rules differ by state and change over time, so confirm anything specific with a licensed attorney in the state where the property was sold.
When a File Needs an Attorney
The claim is made in court. In some states the only way to claim surplus is to file something in a court case. In Texas, excess proceeds from a tax sale are claimed by filing a petition in the court that ordered the sale. In Michigan, a claimant for tax foreclosure proceeds must first send the foreclosing governmental unit (the county treasurer or the state) a notice of intention to claim by July 1 after the foreclosure takes effect, then file a motion in circuit court between February 1 and May 15 after the sale. Filing papers in a court case for someone else is generally treated as practicing law. The Ohio Supreme Court, for example, has said that only a licensed attorney may file pleadings and other legal papers in court or manage court actions for someone else.
A power of attorney does not change that. Some recovery businesses expect a signed power of attorney to let them file in court for the owner. In Virginia, an opinion approved by the state Supreme Court in 2021 says a power of attorney does not let a non-lawyer agent prepare and file pleadings or appear in court for the principal.
More than one person wants the money. Co-owners, an ex-spouse, several heirs, a second mortgage, a judgment creditor, or another recovery company. Once a claim is contested or the court sets a hearing, you need someone who can argue it.
The owner has died. Heirs usually need estate paperwork before a court or county will pay, and some states limit how the claim can pass. Michigan's statute says the right to claim remaining proceeds cannot be transferred except by will or inheritance. Our probate and surplus funds guide covers the usual steps.
The owner is or was in bankruptcy. Under federal bankruptcy law, the debtor's property interests at filing generally become part of the bankruptcy estate. That can change who has the right to the surplus, and the bankruptcy trustee may be involved.
State law limits what a non-attorney can charge. In Texas tax sale cases, a person who is not an attorney may not charge a fee to obtain excess proceeds for an owner, and an attorney's fee is capped at 25 percent of the amount obtained or $1,000, whichever is less. More on fee rules below.
Where to Find Attorneys Who Already Do This Work
"Surplus funds attorney" is not a formal specialty. You are looking for lawyers who already file surplus and excess proceeds claims in the counties you work, and they are easiest to find in the court records.
Start with the court dockets
Every surplus motion names the lawyer who signed it. Pick a county you work, open the clerk's or state court's online case search, and pull foreclosure or tax cases from the last year or two. In each case, look for filings such as:
- Motion to disburse surplus funds
- Claim to surplus, or claim for excess proceeds
- Petition for excess proceeds
- Answers in an interpleader, where the trustee or lender deposits the money with the court and claimants respond
Note the attorney on each filing and which side they appear for. Keep the lawyers who file for owners, heirs or claimants. Lawyers for the lender or a lienholder are usually on the other side of your files, so leave them off. After a dozen cases, a few names will repeat. Those lawyers have worked that courthouse before.
If the owner filed for bankruptcy, the case is on PACER, the federal courts' records system, and the debtor's attorney is listed on the docket.
Then use the attorney directories
Directories rarely have a "surplus funds" category, so search by the practice areas that touch this work: foreclosure, real estate, bankruptcy, and probate.
- Avvo lists attorneys by location and practice area, with years licensed, client reviews, and a section that flags reported discipline. Avvo notes its discipline data may be incomplete.
- Martindale-Hubbell works well for checking a name you already have. Its Peer Review Ratings come from other lawyers rating an attorney's legal ability and ethical standards.
- Justia and FindLaw both have lawyer directories you can search by legal issue and location.
- NACBA, the National Association of Consumer Bankruptcy Attorneys, has a member search for bankruptcy files.
A good profile does not prove surplus experience. The docket does.
Bar directories and referral services
Use the state bar's or state court's attorney lookup to confirm any name you find. Many state and local bar associations also run lawyer referral services that match callers with lawyers by practice area. The American Bar Association has a lawyer referral directory you can search by city and state, and in California the State Bar certifies referral services and lists them by county.
Match the lawyer to the problem
- Foreclosure attorneys work in the courts where mortgage surplus is decided and often know the surplus motion process.
- Real estate attorneys fit files where the question is title, liens, or who owned what on the sale date.
- Bankruptcy attorneys are needed when the owner is or was in an open case.
- Probate attorneys open estates and get the court orders heirs need.
How to Vet an Attorney Before You Send Files
Licensed in the sale state. The attorney should hold an active license in the state where the property was sold. Check the bar's lookup for status and public discipline yourself.
Surplus motions on file. Ask how many surplus or excess proceeds claims they filed in that county in the last year, and ask for a few case numbers. Court filings are public, so you can read them.
Who the client is. When an attorney files the claim, the client is the former owner or heir, not your company, even if you made the introduction or are paying the fee. Lawyer ethics rules allow someone other than the client to pay a lawyer only with conditions. Texas Rule 1.08(e) is a typical example: the client consents, the payer does not interfere with the lawyer's judgment or the client relationship, and the client's information stays protected. So expect the attorney to talk to your client directly and to ask the client's permission before sharing case details with you.
Conflicts. A lawyer can't represent opposing parties in the same case, and representing two people whose interests are adverse can need informed consent from both or rule it out. Ask how they handle files with several heirs or co-owners who may not agree, and whether they ever appear for lenders in the same courthouse.
Communication. Lawyers have a duty to keep clients reasonably informed. Agree up front on how updates reach the client and, with the client's consent, how they reach you: a status note when the motion is filed, when a hearing is set, and when the order is signed.
Turnaround. Ask how long an uncontested claim takes in that court from filing to order, and from order to check, then compare with the docket.
Fees in writing. Get the fee terms in a written engagement letter. In Texas, a contingent fee agreement must be in writing and state how the fee is calculated. Ask whether filing, service and notice costs are separate, and who advances them.
How the Money Works: Fee Splits, Caps, and Who Pays
Lawyers generally can't split legal fees with non-lawyers. The American Bar Association's Model Rule 5.4 says a lawyer or law firm shall not share legal fees with a nonlawyer, with narrow exceptions, and states adopt their own versions. Texas Rule 5.04(a) is one example. Texas also bars lawyers from paying or giving anything of value to a non-lawyer for referring clients, apart from nominal gifts. In practice, an arrangement where the attorney sends part of their fee back to your company is the kind of deal these rules forbid.
Before you work a file with an attorney, ask how fees can be set up under that state's rules, and make sure the client sees every fee in writing before signing anything.
Some state limits treat attorney fees separately. A few examples:
- Washington, foreclosure surplus. It is unlawful to charge more than 5 percent of the amount returned to the owner for locating, or buying the right to recover, foreclosure surplus held by a court or county. Reasonable attorneys' fees and costs are allowed on top of that, but only on a motion and a hearing before a court. Going over the limit is a misdemeanor.
- Florida, mortgage foreclosure surplus. An assignment of the right to surplus counts only if it meets several conditions. These include a written statement that the owner does not need an attorney or other representative to recover the surplus, and total compensation to the assignee of no more than 12 percent of the surplus.
- Texas, tax sale excess proceeds. A non-attorney may not charge a fee to obtain excess proceeds for an owner, and an attorney's fee is capped at 25 percent or $1,000, whichever is less.
These are examples, not a full list, and statutes change. Before you set a percentage in a new state, read the current statute and ask your attorney how it applies to the route you plan to use. Our state statute links are a starting point, and our surplus funds fee agreement guide covers what your own agreement should include.
One more thing to agree on: any surplus figure on a lead is an estimate until the clerk confirms what is on deposit and which liens are paid first. Base fee talks on the confirmed number, not the estimate.
Build a Bench of Attorneys for Each State You Work
Lawyers are licensed state by state, so you need names in every state you work. A working bench looks like this:
- List your states and counties. Start where claims go through a court or files are often contested.
- Pull the dockets. Go through a year of surplus motions in each county, note who files for claimants, and rank the names by how often they appear.
- Reach out with something short. Say who you are, what kinds of files you see (heirs, liens, contested claims), how you work with clients, and how you plan to handle fees under that state's rules.
- Start with one file. Send a single file and watch the response time, how they communicate with the client, and how fast the motion gets filed.
- Keep a backup. Have a second name ready in each state for conflicts, vacations, or a lawyer who stops taking surplus work.
- Keep it all in one place. Track each attorney's states, counties, fee terms, open files, and last update next to the case.
Surplus Funds can help with steps 3 and 6. Our Nationwide and Reserve plans include an Attorney Directory you can search by state and city, with firm and contact details and a ready-to-copy intro script. Every plan includes the CRM, where notes, documents and status stay with each case. Listing in the directory is not an endorsement, so vet every name the same way. You can compare plans on our pricing page.
A Note for Former Owners and Heirs
If you are the former owner or an heir, you may not need anyone's help. Many uncontested claims can be filed directly with the court or county; our guide to claiming surplus funds yourself explains how. If your claim is contested or involves an estate or bankruptcy, a licensed attorney in the state where the property was sold can advise you.
This is general information about surplus funds, not legal advice. Surplus Funds is a software company, not a law firm or a lawyer referral service.