---
kind: "section"
citation: "12 U.S.C. § 3762"
title: "12"
title_heading: "Banks and Banking"
number: "3762"
heading: "Disposition of sale proceeds"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/12/3762"
units:
  - "Chapter 38A — Single Family Mortgage Foreclosure"
---

# §3762. Disposition of sale proceeds

- (a) **Priority payments—** Money realized from a foreclosure sale shall be made available for obligation and expenditure in the following order:
  - (1) **Costs of foreclosure—** To cover the costs of the foreclosure proceeding described in [section 3761 of this title](/usc/12/3761.md).
  - (2) **Tax liens—** To pay valid tax liens or assessments if required by the notice of default and foreclosure sale.
  - (3) **Prior liens—** To pay any liens [recorded](/usc/12/3752.md?p=8) before the recording of the [mortgage](/usc/12/3752.md?p=3) which are required to be paid in conformity with the terms of sale in the notice of default and foreclosure sale.
  - (4) **Service charges and advances—** To pay service charges and advances for taxes, assessments, and property insurance premiums.
  - (5) **Interest—** To pay any outstanding interest.
  - (6) **Principal—** To pay the principal outstanding balance secured by the [mortgage](/usc/12/3752.md?p=3) (including expenditures for the necessary protection, preservation, and repair of the [security property](/usc/12/3752.md?p=9) as authorized under the [mortgage agreement](/usc/12/3752.md?p=4) and interest thereon if provided for in the [mortgage agreement](/usc/12/3752.md?p=4)).
  - (7) **Late charges or fees—** To pay any late charges or fees.
- (b) **Other payments—**
  - (1) **Other lienholders and the mortgagor—** Any surplus of proceeds from a foreclosure sale, after payment of the items described in [subsection (a)](#a) shall be paid in the following order:
    - (A) First, to holders of liens [recorded](/usc/12/3752.md?p=8) after the [mortgage](/usc/12/3752.md?p=3) in the order of priority under Federal law or the law of the [State](/usc/12/3752.md?p=11) in which the [security property](/usc/12/3752.md?p=9) is located.
    - (B) Second, to the appropriate [mortgagor](/usc/12/3752.md?p=5).
  - (2) **Disputed claims—** If the [person](/usc/12/3752.md?p=7) to whom such surplus is to be paid cannot be located, or if the surplus available is insufficient to pay all claimants and the claimants cannot agree on the allocation of the surplus, or if any [person](/usc/12/3752.md?p=7) claiming an interest in the [mortgage](/usc/12/3752.md?p=3) proceeds does not agree that some or all of the sale proceeds should be paid to a claimant as provided in this section, that part of the sale proceeds in question may be deposited by the foreclosure commissioner with an appropriate official or court authorized under law to receive disputed funds in such circumstances. If a procedure for the deposit of disputed funds is not available, and the foreclosure commissioner files a bill of interpleader or is sued as a stakeholder to determine entitlement to such funds, the foreclosure commissioner’s necessary costs incurred in taking or defending such action shall be deductible from the disputed funds.

## Source credit

(Pub. L. 103–327, title II, Sept. 28, 1994, 108 Stat. 2316.)

## Notes

### Editorial Notes

### Codification

Section is based on section 813 of title VIII of S. 2281, One Hundred Third Congress, as reported July 13, 1994, which was enacted into law by Pub. L. 103–327.