Short Answer

In North Carolina, surplus funds from a foreclosure are released by the Clerk of Superior Court only after an order authorizes payment to the correct payee. If the clerk requires it, you submit the clerk’s financial disbursement form (often called an FS‑9) with your tax and payee information after you have an order naming you as the payee. If the existing order lists a different payee (like a prior attorney), you must obtain an amended order or file the proper special proceeding before the clerk to change the payee, then submit the FS‑9.

Understanding the Problem

You’re in North Carolina, and you want the Clerk of Superior Court to release foreclosure surplus funds to you. You already have a court order, but the check is currently payable to a previous attorney, and the clerk has told you to file a special proceeding or submit an FS‑9 before disbursement. You want to know how to get the funds issued in your name now.

Apply the Law

Under North Carolina law, surplus proceeds from a power‑of‑sale foreclosure are paid out to those entitled by order of the Clerk of Superior Court. If there are questions about who should receive the funds or the named payee needs to change, the clerk may require a petition in a special proceeding, proper notice to interested parties, and a hearing. Once the clerk enters an order authorizing payment to the correct person, the clerk’s office typically requires a completed financial disbursement form (commonly called an FS‑9) with payee details (including tax information) before issuing the check.

Key Requirements

• Valid order awarding surplus: You must have an order that authorizes disbursement of the foreclosure surplus.
• Correct payee in the order: If the order names someone else (e.g., a prior attorney), obtain an amended or new order naming you before funds can be cut to you.
• Special proceeding and service (if needed): If payee status is disputed or needs to change, file a petition before the clerk, issue a special proceedings summons, and serve all necessary parties under Rule 4; respondents generally have 10 days to answer.
• Submit the FS‑9 to the clerk: After the order is in place, complete the clerk’s financial disbursement form with your legal name, address, and tax ID (often with a W‑9) so the check can be issued.
• Hearing and order entry: If any party objects or factual issues arise, the clerk will conduct a hearing; some matters can be transferred to Superior Court if required.

What the Statutes Say

• North Carolina Gen. Stat. § 45‑21.31 (Surplus proceeds of foreclosure) – Surplus is paid to persons entitled; clerk may hold and order distribution.
• North Carolina Gen. Stat. § 1‑393 (Special proceedings; procedure) – Special proceedings follow civil rules except as otherwise provided.
• North Carolina Gen. Stat. § 1‑394 (Summons; service; time to answer) – Clerk issues summons; respondents typically have 10 days to answer in special proceedings.

Analysis

Apply the Rule to the Facts: You already have an order releasing surplus funds, which satisfies the first requirement. Because the check is payable to a previous attorney, you need an order naming you as the payee; that may require a short special proceeding before the clerk with proper service and a brief response window. Once the clerk signs an updated order, complete and submit the FS‑9 (with your W‑9) so the clerk can issue the check in your name.

Process & Timing

1. Who files: The entitled claimant. Where: Clerk of Superior Court in the county where the foreclosure file is/was pending. What: If payee must change, file a verified petition to disburse/redirect surplus proceeds and request an amended order; have the clerk issue a Special Proceedings Summons (AOC‑SP‑100) and serve parties under Rule 4. When: After service, respondents generally have 10 days to answer.
2. Attend the clerk’s hearing if scheduled. If no objections are filed, the clerk may enter the amended order on the papers; if objections exist, the clerk will hear and decide the matter (some disputes may be transferred to Superior Court).
3. After the order names you as payee, submit the FS‑9 (clerk’s financial disbursement form) with your legal name, current address, and tax ID (often via W‑9). The clerk’s office will process and issue the check to you.

Exceptions & Pitfalls

• Competing claims: If others assert rights to the surplus, the clerk will require notice, may hold a hearing, and can delay disbursement until claims are resolved.
• Payee mismatch: The clerk cannot reissue funds to a new payee without an order. If the prior attorney is named, seek a consent or amended order substituting you.
• Service defects: Improper service or missing parties can stall your petition; use Rule 4 service and file proof of service.
• Form details: The FS‑9 must match the order (name, capacity) and include tax information (e.g., W‑9); mismatches or missing IDs delay the check.
• Transfer to Superior Court: If disputed facts or equitable defenses arise, the matter may be transferred, which can extend timelines.

Talk to a Surplus Funds Attorney

If you’re dealing with a foreclosure surplus and the clerk is asking for a special proceeding or an FS‑9 before releasing funds, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at [919-341-7055].

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.