Who would benefit from the equity

Equity after foreclosure cannot be presumed. If there is any, the bank would have the equity.

My understanding is that equity is the amount of sales proceeds remaining after deducting the unpaid loan balance and costs. That equity belongs to the borrower.

Dog-gone I thought I had an example of a case/link affirming this not true but cannot find it. It may have been a particular state or special situation. I apologize, I jumped the gun. Under typical circumstances, equity belonging to the [former] homeowner makes sense.

Stand by, several knowledgeable fold peruse these Law boards - I bet one will be by shortly :)

I agree with Rick, Equity after foreclosure can't be assumed. The property will be sold at auction with a price being set at the loan balance plus fees. If the property could sell for more than is owed, the owner could sell it themselves by lowering the price.

But I also agree with George. In the unlikely event that the property is sold for more then is owed the lender, pluse fees and incendentals, then the difference does go to the owner.