Arkansas recovery agents: learn who can claim tax-sale surplus, what documents are required, where funds are held, and which mortgage rules remain unclear.
| Foreclosure type | Arkansas’s Statutory Foreclosure Act provides a power-of-sale process. The mortgagee or trustee conducts the sale, or their attorney may act as auctioneer. (Sections 3 and 7) |
| Mortgage surplus | Sale proceeds pay sale costs, the debt, and later recorded liens in priority order. Any surplus goes to the grantor of the trust deed or an entitled successor in interest. (Section 9) |
| Tax sale surplus | The former record owner may apply after the one-year escrow period. Heirs or relations within the first degree of consanguinity may also claim if they provide the required extra documents. (26 CAR §§ 400-402 and 400-403) |
| Deadlines | Tax-sale funds are held for one year before a claim may be made. The claim period depends on when the parcel sold. Mortgage claim deadlines remain unclear. (Arkansas.gov; 26 CAR § 400-405) |
| If no one claims it | Tax-sale funds not distributed within the time that applies to the parcel escheat to the county where the parcel is located. (26 CAR § 400-405) |
| Fees and agreements | For a tax-sale claim involving an agent, the signed contract may not allow a fee over 10% of the excess proceeds. The agent must also sign a third-party release and indemnification. (26 CAR § 400-403) |
| Third parties | A third-party agent may assist with a tax-sale claim if the required contract and release are provided. The former owner or a qualifying first-degree heir or relation may claim the proceeds. The agent is not the payee. (26 CAR § 400-403) |
Checked against the official state code and government office pages in November 2026.
Who gets the money left over?
In Arkansas, the rules differ for mortgage foreclosure and tax-sale excess proceeds. First, find out which kind of sale created the funds. The tax-sale claim packet and payment process are described below.
After a tax sale, the former owner may apply if they held record title when the parcel was sold. Heirs or relations within the first degree of consanguinity may also claim, subject to extra documentation. This generally means a parent, child, or sibling of the former owner. A former owner, part-owner, or interested party who bought the parcel at the tax sale can't receive the excess proceeds. If the former owner is a corporation, partnership, or other legal entity, it must be able to own real property in Arkansas. (26 CAR § 400-403)
“Excess proceeds” means money from a bid or sale that is more than the taxes, fees, penalties, interest, and costs due on the parcel at the time of sale. (26 CAR § 400-401(a))
Start by checking whether the claimant held record title when the sale happened or is a qualifying first-degree heir or relation. A complete claim packet needs a claim form, deed of release, release and indemnification, W-9, a copy of the deed vesting title in the former owner, proof of mail receipt at the address certified by the county, and two forms of identification. An heir or relation must provide extra documents required by the rule. If the claim uses a third-party agent, the packet must also include the agent’s signed release and indemnification and a signed contract between the agent and the former owner. (26 CAR § 400-403)
Heirs or relations within the first degree of consanguinity can claim excess proceeds if they meet the rule’s requirements. This generally means a parent, child, or sibling of the former owner. They must provide extra documents required by the rule. (26 CAR § 400-403)
For an agent, a good first step is to help the family confirm who held record title and ask the Commissioner of State Lands what documents may be accepted for the claim.
The rules identify the former owner and qualifying first-degree heirs or relations as people who may claim tax-sale proceeds. They do not name assignees or power of attorney holders as claimants. Don't assume an assignment or power of attorney makes someone entitled to the money. Confirm with the Commissioner before acting on that basis. (26 CAR §§ 400-402 and 400-403)
A third-party agent may assist with a tax-sale claim. The packet must include a signed contract between the agent and the former owner. The contract cannot allow a fee over 10% of the excess proceeds. The agent must also sign a third-party release and indemnification. The rule does not make the agent the payee. (26 CAR § 400-403)
For tax-sale excess proceeds, the distribution follows a specific order. Within one calendar year after the Commissioner of State Lands receives the money, it pays listed penalties, collection fees, sale costs, and other costs allowed by law, then the county’s delinquent taxes, interest, and costs. (26 CAR § 400-402)
Any money left is held for one year after the limited warranty deed date. After that year, approved applications from government entities may lead to payments for certain taxes and solid waste assessments. From any money still left, 10% goes to the Commissioner, up to $500, but enough to cover deed recording fees. The balance goes to the former owner after the Commissioner approves a complete application packet and any other required documents. A parent, child, or sibling of the former owner may also claim with extra proof, such as a death certificate and an affidavit of heirship. (26 CAR §§ 400-402 and 400-403)
For mortgage foreclosure proceeds, the order is sale costs, the debt, and later recorded liens according to priority. Any surplus goes to the grantor of the trust deed or a successor in interest entitled to it. (Section 9)
For tax-sale excess proceeds, the funds are held in escrow for one year. After that, the record owner at the time of sale or a qualifying first-degree heir or relation may apply. Arkansas.gov says funds for parcels sold from July 1, 2005, through June 30, 2018, are available to claim for three years. Funds for parcels sold after July 1, 2018, are available for two years. The rule says proceeds are held for two years, or for the period required by the law in effect when the parcel was sold. Check the period that applies to the parcel before setting a client timeline. (Arkansas.gov; 26 CAR § 400-405)
If excess proceeds are not distributed within the period that applies to the parcel, they escheat to the county where the parcel is located. The former owner or anyone else cannot recover funds held past that date. (26 CAR § 400-405)
We didn't find a mortgage claim deadline spelled out in the state code or on official sites. Before you set a timeline for a client, ask the office handling that money what deadline applies.
I've been recovering surplus funds since 2013. That's over 2,000 cases and more than $100 million recovered for foreclosure victims across the country. Families can have a lot to sort through while learning about a claim. Start by confirming whether the funds came from a tax sale or mortgage foreclosure. Then ask the relevant office what to do next.
If you want to learn how this business actually works, join the free Surplus Funds Masterclass at surplusfunds.ai, or join the free Surplus Funds Collective community on Skool at skool.com/surplusfunds.
This guide is education, not legal advice. Laws change, so check the official statute and talk to a licensed attorney in your state before you act.
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