What is Unclaimed Property? Complete Guide 2025

Right now, there's over $70 billion in unclaimed property held by states across America. California alone holds more than $14 billion. But what exactly is unclaimed property, how does it become unclaimed, and what happens to it?

This comprehensive guide will explain everything you need to know about unclaimed property, from how it's created to how you can claim it.

What is Unclaimed Property?

Unclaimed property (also called abandoned property or escheat property) is any financial asset that has been turned over to the state because the rightful owner could not be located after a period of inactivity.

It's important to understand that unclaimed property isn't "lost" in the traditional sense. The state knows exactly where it is and actively tries to return it to owners. What's "lost" is the connection between the property and its rightful owner.

Key Point: Unclaimed property isn't money the state found lying around. It's money and assets that businesses are legally required to turn over when they can't locate the owner after a specific period (usually 3-5 years of inactivity).

How Does Property Become Unclaimed?

Property becomes unclaimed through a legal process called "escheatment." Here's how it typically happens:

The Dormancy Period

When an account or asset becomes inactive (no owner contact, no transactions) for a specified period, it's considered "dormant." The dormancy period varies by state and property type:

• Bank accounts: Usually 3-5 years of inactivity
• Stocks and securities: Typically 3-5 years
• Insurance proceeds: Often 3-5 years after maturity or death
• Wages and payroll: Usually 1-3 years
• Utility deposits: Typically 1-3 years after account closure

The Due Diligence Process

Before turning property over to the state, businesses must make a "good faith effort" to locate owners:

1. Sending certified mail to the last known address
2. Searching databases for updated contact information
3. Publishing notices in local newspapers (for larger amounts)
4. Checking with the post office for forwarding addresses

If these efforts fail, the company must report and remit the property to the state.

Transfer to the State

Once the dormancy period ends and due diligence is complete, the business files an unclaimed property report with the state and transfers the assets. The state then becomes the custodian, holding the property in trust until the rightful owner claims it.

Types of Unclaimed Property

Unclaimed property includes a wide variety of assets. Here are the most common types:

Financial Accounts

• Checking and savings accounts - Dormant bank accounts from closed or forgotten institutions
• Certificates of deposit (CDs) - Matured CDs where owners didn't claim the funds
• Money orders and cashier's checks - Uncashed or forgotten
• Safe deposit box contents - Contents from abandoned boxes

Investment Assets

• Stocks and bonds - Shares in companies, especially after mergers or name changes
• Dividends - Uncashed dividend checks from stock ownership
• Mutual funds - Forgotten investment accounts
• Brokerage accounts - Inactive trading accounts

Business and Employment

• Wages and commissions - Uncashed paychecks or final wages
• Vendor payments - Unpaid invoices or refunds to businesses
• Expense reimbursements - Unredeemed business expense payments
• Customer overpayments - Refunds or credits never claimed

Insurance and Benefits

• Life insurance proceeds - Death benefits where beneficiaries weren't located
• Insurance claim payments - Uncashed checks from settled claims
• Annuity payments - Payments from annuities where owners lost contact
• Pension benefits - Unclaimed retirement account distributions

Utility and Service Deposits

• Utility deposits - Refunds from gas, electric, water companies
• Cable and internet deposits - Service deposits never returned
• Rental deposits - Security deposits from landlords
• Gym memberships - Refunds from canceled memberships

Court and Government

• Court deposits - Funds from legal settlements or cases
• Escrow accounts - Real estate transaction funds
• Tax refunds - Uncashed state tax refund checks
• Government overpayments - Refunds from various agencies

What Happens to Unclaimed Property?

State Custody

When property is turned over to the state, it doesn't go into the general budget. Instead, it's held in a custodial account. The state's role is to:

• Maintain records of all unclaimed property
• Create searchable databases for owners
• Attempt to locate owners through mailings and publicity
• Process and verify claims
• Return property to verified owners

No Expiration Date

In California and most states, unclaimed property never expires. You can claim it 10, 20, or even 50 years later. However, some important notes:

• Physical property may be sold: States can sell physical items (like safe deposit box contents) and hold the cash proceeds
• Securities may be liquidated: Stocks and bonds might be sold, with the state holding the cash value
• Interest doesn't accrue: Money held by the state doesn't earn interest (in most states)

Return to Owners

States return billions in unclaimed property each year. In California alone, over $300 million is returned annually to rightful owners. The claiming process is free and relatively straightforward.

Common Misconceptions About Unclaimed Property

"It's Too Good to Be True"

Many people are skeptical when they discover unclaimed property in their name. Rest assured, unclaimed property programs are legitimate government operations. Every state has an official unclaimed property office, usually run by the State Controller, Treasurer, or similar agency.

"The State Will Contact Me"

While states do make efforts to contact owners (especially for larger amounts), they have limited resources. With tens of millions of properties, it's impossible to contact everyone. The burden is on you to search and claim your property.

"I Would Know If I Had Unclaimed Money"

Actually, it's very easy to lose track of assets, especially:

• When you move and forget to update addresses
• After changing your name (marriage, divorce)
• During busy life transitions (new job, having children)
• When companies merge, close, or change names
• For small amounts you didn't think were worth tracking

"It's Probably Just a Few Dollars"

While some unclaimed properties are small (under $100), many are substantial. The median unclaimed property value in California is around $200, but thousands of properties are worth over $10,000. You won't know unless you search.

Why Does Property Become Unclaimed?

Understanding why property becomes unclaimed can help you prevent losing track of your own assets:

1. Moving Without Updating Addresses

The #1 reason for unclaimed property. When you move, make sure to:

• File a change of address with USPS
• Update your address with all financial institutions
• Update employer records, even if you're leaving the company
• Notify utility companies when closing accounts

2. Small Balances Forgotten

People often forget about accounts with small balances, thinking they're not worth the effort. But over time, multiple small accounts can add up to significant money.

3. Life Changes and Transitions

During major life events (divorce, death of a family member, job loss, relocation), it's easy to lose track of financial accounts in the chaos.

4. Company Changes

When companies merge, change names, or go out of business, it's easy to lose touch with your accounts or benefits associated with that company.

5. Deceased Relatives

Heirs often don't know about all the accounts and assets belonging to deceased family members, especially from previous generations.

How to Prevent Your Property From Becoming Unclaimed

Take these steps to keep your assets from becoming unclaimed:

1. Keep contact information updated with all financial institutions
2. Monitor accounts regularly - Log in at least once a year
3. Cash checks promptly - Don't let checks expire
4. Maintain records of all financial accounts and safe deposit boxes
5. Inform beneficiaries of all accounts and insurance policies
6. Consolidate accounts when possible to reduce accounts to track
7. Close unused accounts properly and withdraw all funds
8. Keep a financial inventory document for your heirs

Searching for Unclaimed Property

If you want to check whether you have unclaimed property, you have several options:

Official State Databases

Every state maintains a free, searchable database. In California, it's managed by the State Controller at sco.ca.gov. These databases are comprehensive but have limitations like exact name matching only.

Advanced Search Tools

Services like Uncover Finance offer enhanced searching capabilities:

• Automatic checking of name variations and nicknames
• Advanced filtering by value, property type, or location
• Bulk searching for multiple family members
• Access to the complete database with sorting capabilities

Multi-State Searches

If you've lived in multiple states, search each state separately. You can also use NAUPA's website (unclaimed.org) to search all states at once, though results may be less detailed than individual state sites.

Frequently Asked Questions

Is unclaimed property a scam?

No, unclaimed property programs are legitimate state government operations. However, be wary of third parties claiming they can get you unclaimed property for a fee. You can always search and claim for free through official channels.

How long does the state hold unclaimed property?

In California and most states, unclaimed property is held indefinitely with no expiration date. You can claim it 50 years from now if needed.

Does unclaimed property earn interest while held by the state?

In most states, including California, unclaimed property does not earn interest once turned over to the state. You'll receive the original amount that was reported.

What if the business that held my money no longer exists?

It doesn't matter. Once the property is turned over to the state, the business's status is irrelevant. You claim from the state, not the original company.

Can I claim unclaimed property for someone else?

You can claim on behalf of deceased relatives if you're the legal heir. For living individuals, you typically need power of attorney or similar legal authorization.

What happens if multiple people claim the same property?

The state will investigate and determine the rightful owner based on documentation provided. This commonly happens with deceased individuals where multiple heirs may have claims.