You might lose your home to a tax foreclosure if you don’t pay your New York property taxes. You will get some time to make things right to prevent this from happening though. Find out in this article how New York’s tax foreclosure process works, what type of notice you’ll receive if you’re facing a tax foreclosure, and how to stop the process to ensure you don’t lose ownership of your home.
Failing to keep up with the property taxes on your New York home can lead to a tax foreclosure. (Learn about youroptions if you can't pay the property taxes on your home.)
Here’s how a New York tax foreclosure works: When you don’t pay the taxes, the delinquent amount (which includes the accrued taxes, interest, penalties, and costs resulting from the delinquency) becomes a lien on your home. A lien is a legal claim on your property. The taxing authority can then foreclose the lien to collect the overdue amounts. (A few places in New York sell tax lien certificates, which means they sell the lien that exists on the home rather than foreclosing in order to collect the overdue taxes. This article, however, focuses on the tax foreclosure process.)
In New York, the tax foreclosure procedure is similar to the mortgage foreclosure process. (You can find more detailed articles on various aspects of New York mortgage foreclosure law in Nolo’s New York Foreclosure Law Center.) A petition (lawsuit) is filed in court.
If you don’t respond to the lawsuit by filing an answer that lists your objections to the case, the court will enter a default judgment against the property. (A default judgment means you automatically lose since you didn't answer the suit.) Then, either the tax district gets possession of the property directly or an auction is held to sell it (N.Y. Real Prop. Tax Law § § 1120, 1136).
When the foreclosure petition is filed, a notice of foreclosure must be published in a newspaper (N.Y. Real Prop. Tax Law § 1124). On or before the first date of publication, the enforcing officer must send you a notice by certified and first-class mail stating that the foreclosure has started (N.Y. Real Prop. Tax Law § 1125).
Posting may also be required. If the mailings get returned and there is no alternate address to send them to, the notice must be posted on the property (N.Y. Real Prop. Tax Law § 1125).
Contents of the notice. The notice will specify, among other things, the last day that you can redeem (see below) the property (N.Y. Real Prop. Tax Law § 1125).
In New York, you get some time to save your home from the tax foreclosure. During this time period (a “redemption period”), you can pay all delinquent taxes and other charges to stop the foreclosure. This is called “redeeming” the home.
How long you get to redeem. Generally, the redemption period expires two years after the lien date (that is, when the tax or other legal charges became a lien). However, local law may provide a longer redemption period (N.Y. Real Prop. Tax Law § 1110). (Learn more in Getting Your Home Back After a Property Tax Sale in New York.)
When the foreclosure starts in comparison to the redemption period. The foreclosure proceeding generally starts around three months before the redemption period expires (N.Y. Real Prop. Tax Law § 1124).
The citations to New York’s tax foreclosure statutes are: New York Real Property Tax Law § § 1100 through 1194.
You can find the New York Laws at http://public.leginfo.state.ny.us/lawssrch.cgi?NVLWO. (If you need help finding the statutes, see Nolo’s Legal Research FAQs & Basic Info area.)