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NYC TAX Liens
NYC Tax Lien Sale
Every year, the Department of Finance sells the liens of properties that have unpaid debts — including property taxes, water bills, and other charges — that can result in an increased financial burden for families already behind on their bills. Once a tax lien is sold, a third-party collection agency can add fees and high interest of up to 18 percent, compounded daily. This mounting debt can force some homeowners into foreclosure.
1-3 Family Homes on the 90-day Lien Sale Warning List
The New York City Department of Finance notifies homeowners that their unpaid tax and water debts will be sold with a 90-day warning.
What Homeowners Need To Know
In August 2020, the City is scheduled to hold its annual tax lien sale. If you are a homeowner and owe property tax or water/sewer payments, or have had emergency repairs made by the City, you may be at risk of having your lien sold. The good news is that help is available!
Where to get help
Call us: For help with property tax and water lien issues, call NHS Brooklyn at 718-469-4679 and ask to speak to a housing advisor.
Overdue property taxes. Connect with the Dept. of Finance (DOF): Call 311 and speak to DOF directly to make a payment, or visit their website at nyc.gov/liensale to obtain a payment agreement or complete exemption forms.
Overdue water and sewer bills. For water and sewer payments, call 718-595-7000 to get in touch with DEP or visit their website to pay online. For the first time, the City will offer a one-time exception and allow homeowners who have previously defaulted on payment plans to enter into new payment plans.
Talk to your bank/mortgage servicer: Mortgage servicers are often willing to pay off an outstanding lien to protect their interest in the property. If you have a lien on your property, it’s possible that your servicer does not know this. If you are unable to pay off the lien right away, reach out to your servicer – it’s likely that they’ll pay off the lien and treat it as an escrow advance to be paid off over time. However, you’ll need to be careful that the new payment is affordable, so be sure to understand fully what impact this will have on your payment. If you think it will not be affordable, call us! We’re here to help. Check your most recent mortgage statement for your mortgage servicer’s contact information.
How the Lien Sale Works
Once a lien is sold to a third party, collection agencies can add fees and interest rates as high as 18% onto the debt. Paying the debt can become overwhelming, especially if you already have a tight budget, and a lien could lead to foreclosure. It is possible that a foreclosure can be initiated as little as six months after the sale, if the interest on the debt remains unpaid and no payment plan is initiated. It takes far less time to file a foreclosure for an unpaid lien than it does for an unpaid mortgage. If you are behind on both your mortgage and taxes, we advise that you contact your mortgage company to discuss how to resolve the lien.
When is a lien eligible to be sold?
For 1-3 family homes, a tax lien is sold if a homeowner has sustained a debt of at least $1000 for over three years.
For 2-3 family homes, a water or sewer lien of at least $2000 will also be sold if it has been due for over a year.
Get Off the Lien Sale List!
At this point, everyone on the 90-day lien sale list should have received a Notice of Intent to Sell Lien in the mail from DOF. Even if you do not receive a notice, you may still be on the sale list – and not receiving the notice does not excuse you from the lien sale. DOF publishes the list of properties that qualify for the lien sale 90, 60, 30, and 10 days before the sale. You can refer to the most recent list to confirm whether or not you are on the sale list.
You have several options to get off the list before your lien is sold:
Pay your outstanding tax lien charges in full to DOF or water lien charges to the Department of Environmental Protection.
Enter into a no money down payment agreement that can break down your lien into smaller payments over a time period of up to 10 years.
Apply for an exemption. Exemptions are available for seniors, people with disabilities, veterans, and those on active military duty.