Where there's money, there are scammers. Surplus funds recovery has unfortunately attracted bad actors who prey on people hoping to recover money from foreclosure sales. Knowing how to identify scams can save you from losing money — or worse, your personal information.

Protecting yourself from scams

Learn to identify and avoid surplus funds scams

⚠️ Important Warning

Legitimate surplus funds recovery services NEVER require upfront payment. If someone asks you to pay before recovering your funds, it's almost certainly a scam.

Common Surplus Funds Scams

1. The Upfront Fee Scam

Scammers contact you claiming they can recover your surplus funds, but you need to pay a "processing fee," "filing fee," or "administrative cost" upfront. Once you pay, they disappear.

Red Flag: Any request for payment before services are rendered. Legitimate recovery services work on contingency — they only get paid when you get paid.

2. The Fake Government Letter

You receive an official-looking letter claiming to be from a government agency, stating you have unclaimed funds. The letter asks you to pay a fee or provide sensitive information to "release" the funds.

Red Flag: Government agencies don't charge fees to release your own money. They also won't ask for sensitive information via mail or email.

3. The Pressure Tactics Scam

Someone contacts you with urgent language: "You must act TODAY or lose your funds forever!" They pressure you to sign contracts or make payments immediately without time to think or research.

Red Flag: Legitimate companies give you time to review contracts and make informed decisions. High-pressure tactics are a classic scam indicator.

4. The Inflated Amount Scam

Scammers claim you're owed a much larger amount than actually exists, getting you excited about a big payday. They then ask for fees based on this inflated number.

Red Flag: Claims of very large amounts without documentation. Always verify the actual surplus amount with the county before engaging any service.

5. The Identity Theft Scam

Under the guise of helping you claim surplus funds, scammers collect your personal information — Social Security number, bank accounts, copies of IDs — then use it for identity theft.

Red Flag: Requests for sensitive information early in the process, before any verification of who they are or confirmation that surplus funds exist.

Red Flags to Watch For

  • Upfront fees: Any request for payment before recovery
  • Guaranteed results: No one can guarantee a successful claim
  • Pressure to act immediately: Legitimate deadlines exist, but you should have time to research
  • Vague company information: No physical address, no verifiable credentials
  • Unsolicited contact: Be extra cautious with cold calls or unexpected letters
  • Requests for wire transfers or gift cards: Legitimate businesses don't ask for these payment methods
  • Poor grammar and spelling: Often indicates overseas scam operations
  • No written contract: Legitimate services provide clear, written agreements
Legitimate recovery service

Work only with verified, legitimate recovery services

Signs of a Legitimate Recovery Service

Contingency-based fees: They only get paid when you successfully recover funds — typically a percentage of the recovered amount.
Transparent process: They explain exactly how the recovery process works and what to expect.
Verifiable information: They have a real business address, phone number, and online presence you can verify.
Written contracts: They provide clear agreements outlining services, fees, and your rights.
No pressure: They give you time to review information and make decisions.
Free initial consultation: They'll discuss your case and verify surplus funds exist before asking for any commitment.

How to Verify a Recovery Service

  1. Search online: Look for reviews, complaints, and any news about the company
  2. Check the Better Business Bureau: See if they're accredited and check their rating
  3. Verify their address: Is it a real office or a P.O. box?
  4. Ask for references: Legitimate companies can provide references from past clients
  5. Consult your state's consumer protection office: Check for complaints or enforcement actions
  6. Verify the surplus exists: Contact the county directly to confirm funds are being held

What to Do If You've Been Scammed

If you believe you've fallen victim to a surplus funds scam:

  1. Stop all communication: Don't send any more money or information
  2. Document everything: Save all emails, letters, and records of payments
  3. Report to the FTC: File a complaint at ReportFraud.ftc.gov
  4. Contact your state attorney general: They handle consumer fraud complaints
  5. Report to local police: File a report, especially if you lost money
  6. Monitor your credit: If you shared personal information, watch for identity theft
  7. Contact your bank: If you made payments, ask about chargebacks or fraud protection

You Can Claim Funds Yourself

Remember: you can always attempt to claim surplus funds on your own, directly through the county. It's free to file a claim yourself. The process can be complex and time-consuming, but it's an option if you're concerned about working with any third party.

Recovery services exist because the process can be complicated, time-consuming, and confusing. A legitimate service earns their fee by handling the research, paperwork, and follow-up — but they should never require payment upfront.

Work With a Legitimate Recovery Service

We work on contingency only — no upfront fees, ever. Free consultation to verify if surplus funds exist and discuss your options.

Get Your Free Consultation

The Bottom Line

Surplus funds scams are unfortunately common, but they're also avoidable. The biggest red flag is any request for upfront payment. Legitimate recovery services work on contingency because they're confident in their ability to recover funds.

When in doubt, verify directly with the county that surplus funds exist, and take your time researching any company before signing anything. Your money has waited this long — a few more days to do proper due diligence won't hurt.