Short answer. The leftover amount is added to the debtor's free property — assets not already tied to a specific-property preference — and becomes available there for payment of the debtor's other credits, rather than staying reserved for whoever held the earlier claim on that particular property.
What the law says
The excess, if any, after the payment of the credits which enjoy preference with respect to specific property, real or personal, shall be added to the free property which the debtor may have, for the payment of the other credits.
Civil Code, Article 2250 — The Excess Goes to the Free Property. Read the full provision →
The surplus rejoins the general pool
Once the credits that enjoy preference over a specific piece of property — real or personal — have been paid out of that property's value, whatever is left does not simply vanish or stay set aside. The statute directs that this excess be added to the debtor's free property, meaning the assets not already earmarked for a specific-property preference. From that point on, the surplus is treated the same as the rest of the debtor's unencumbered assets.
Why this matters for the remaining creditors
Once folded into the free property, the surplus becomes available for the payment of the other credits — the claims that were not given a preference over that specific property in the first place. This prevents a windfall from sitting idle simply because it originated from a particular asset; instead, it flows into the common pool from which the debtor's remaining, generally unsecured or lower-priority obligations are satisfied.
What this provision assumes
This rule presumes there actually is an excess after the specific-property preferences are paid — if the property's value does not even cover those preferred credits in full, there is nothing left to add to the free property, and this article has nothing further to distribute. It also assumes the debtor has other, unencumbered property to which this surplus can be added; the provision describes where the excess goes, not how the debtor's remaining creditors are subsequently ranked once it arrives there, which depends on the separate rules governing the order of preference among ordinary credits.
The logic behind treating the surplus this way
A preference over specific property exists to guarantee a particular creditor gets paid from a particular asset, up to what that asset is worth — it is not meant to give that creditor a claim on value beyond what the preference actually secures. Once that preferred claim is satisfied, the reason for singling out that property disappears, and there is no basis to keep the remaining value apart from everything else the debtor owns. Returning the surplus to the free property keeps the debtor's other creditors from being shortchanged by a preference that has already served its purpose in full.