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Who will receive the profit on a foreclosed residential property that is worth more (mkt value) than what is owed on the loan

Fairfax, VA |

My house is being foreclosed on (to be sold on the Co. steps). After bad advice, more bad advice and thousands of dollars in service fees; I am done, I tried my best to save it. My question is, my mortgage loan is $300k but the market value of my home is $500k +/-. Homes in my neighborhood are quickly selling at that price. If there is any profit from the sale on the Co. steps, who gets that amount? The bank?

Attorney Answers 2


The borrower gets the surplus, if any, after paying off all liens and all costs of sale (although you may need to submit a claim to the foreclosure trustee to get them - contrary to the other post, no involvement of the sheriff in Va. foreclosures). But understand that a foreclosure sale is unlikely to generate top dollar. You would be well advised, if it is really worth that much, to sell it through a real estate agent. Even if sold for slightly less than full value to get a quick sale, that will be more than the foreclosure would generate. If you actually have a contract without any contingencies, most lenders will stop the foreclosure sale, and if they refuse you can file a bankruptcy case to stop it and make the private sale happen.

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The homeowner should receive any proceeds from the sale of the property that are remaining after the liens and fees and cost are paid. The sheriff will issue a report to the courts

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