Alabama Surplus Funds Laws
How mortgage foreclosure surplus, tax sale surplus and unclaimed funds work in Alabama.
Mortgage foreclosure surplus
Governing Law: Ala. Code Title 35, Chapter 10; §§ 35-10-11 to 35-10-16 govern power of sale for mortgages executed after December 31, 1988. Alabama case law governs entitlement to foreclosure surplus. Relevant contract limitations statutes include Ala. Code §§ 6-2-34 and 6-2-33. Deadline: No separate statutory foreclosure surplus claim period. A contractual claim under an unsealed mortgage is generally subject to a six year limitations period; a claim founded on a sealed instrument may be subject to a ten year period. The foreclosure redemption deadline is separate.
Tax sale surplus
Governing Law: Ala. Code §§ 40-10-28, 40-10-120, and 40-10-122; §§ 40-10-82 and 40-10-83 when judicial redemption applies; § 40-10-197 for applicable tax lien certificate foreclosure proceedings. Deadline: For excess under § 40-10-28, claims based on proper redemption may be presented during the first three years after sale. Qualifying claims remain available after year three until 10 years after a 2016 or later sale, 11 years after a 2015 sale, or 12 years after a 2014 sale. After the applicable outer limit, the excess becomes county property.
Unclaimed funds
Governing Law: Ala. Code §§ 35-12-70 to 35-12-96, Uniform Disposition of Unclaimed Property Act of 2004; claims governed principally by §§ 35-12-83 to 35-12-85. Deadline: No statutory deadline for an owner to claim property held by the Alabama Treasurer. The Treasurer must decide a filed claim within 120 days and pay an allowed claim within 30 days. A judicial challenge to a denial must be brought within 90 days after the Treasurer’s decision.
Statute text
Links to the statutes referenced in our research. These may be third-party copies of older code editions, so check the current official code before relying on them.
Sources
- [2] K & C Development Corp. v. AmSouth Bank, 597 So. 2d 671 (Ala. 1992).
- [3] Alabama Legislative Services Agency, Alabama Law Institute report, discussion of Ala. Code §§ 35-10-11 to 35-10-16.
- [4] Act 2024-261, HB 270, enrolled text amending Ala. Code §§ 40-10-28 and 40-10-197.
- [5] Office of the Alabama State Treasurer, Unclaimed Property Law.
- [6] Alabama Administrative Code r. 892-2-1-.02.
- [7] Alabama Department of Revenue, r. 810-4-6-.02.


