Your property can become unclaimed for several reasons. Generally, a property is considered unclaimed when its owner can’t be located or contacted or when the owner has not taken any action to maintain or access the property for a prolonged period.
In this article, we’ll explore the different ways that property can become unclaimed and the steps that property owners can take to prevent their assets from being lost or disposed of.
How Does Property Become Unclaimed?
Unclaimed property is any asset or funds that have gone unclaimed by their rightful owners for an extended period. While the definition of unclaimed property can depend on specific state laws, typical examples include uncashed checks, utility deposits, safe deposit boxes, and dormant stocks.
Unclaimed property is most often acquired when owners become deceased, move without leaving a forwarding address, misplace ownership records, or forget their accounts exist.
Each state has implemented an unclaimed property program to ensure owners don’t unknowingly lose the title to the property. This safeguards the funds and protects them from going unclaimed for an extended period.
Reasons for Property Becoming Unclaimed
A property becomes unclaimed for a variety of reasons, including:
- the death or relocation of an account holder
- unclaimed court balances
- unclaimed insurance policy proceeds
- forgotten bank accounts
Unclaimed property can also come from unexercised stock options or gifts not claimed by the recipient. The rules governing unclaimed property vary according to the state, but most states have similar laws.
The Unclaimed Property Process
When an item of property is considered unclaimed, the process is initiated to return it to its rightful owner.
Generally, attempts are made to contact the account holder via the contact details on file. These attempts may include email notices, letters sent via certified mail, or other communication methods, depending on the type of property in issue.
Each state sets a deadline by which an owner must claim their unclaimed property. If the property remains unclaimed past the required date, then the property is reported to the state, and the state assumes fiduciary responsibility for the property.
Once the state assumes responsibility for unclaimed property, the state acts as the custodian of that property and attempts to locate the rightful owner.
State management of unclaimed property includes attempting to locate the rightful owner via mail and through unclaimed property databases and public notice publications.
How the State Tries to Contact You
States that manage unclaimed property must actively contact the rightful owner.
Generally, this process begins when a state posts unclaimed property details in an online database. Here, potential claimants can research each unclaimed property item, including the date it was reported, the type of property, and the specific amount.
When a state locates the rightful owner, a notice is sent to the address on file via first-class or certified mail. Some states will also carry out the extra step of publishing information about unclaimed assets in newspapers and other forms of public notice media.
Scams to Be Aware Of
With the rise in unclaimed property, scams and fraudulent attempts to acquire unclaimed property have become a major concern.
Phishing scams occur frequently and involve criminals who promise to locate unclaimed assets for a fee or a percentage of the proceeds. Other scammers will agree to find the unclaimed property but return money stolen from another victim instead.
In addition, be wary of collection agencies or companies that claim to be associated with a state government. Most states only allow their state-designated agency to handle unclaimed property.
Even if your state employs an outside contractor, those contractors will never ask you for a fee to locate unclaimed property.
Conclusion
Unclaimed property is a widespread problem that affects many individuals and businesses. Property can become unclaimed for various reasons, such as abandonment, unpaid debts, and lost or stolen property.
However, each state has implemented an unclaimed property program to safeguard these assets and protect them from going unclaimed for an extended period.
Furthermore, being cautious of scams and fraudulent attempts to acquire unclaimed property is crucial. Stay vigilant and informed. If you believe you might have unclaimed property, check with your state’s program and take the necessary steps to claim it.