NYC Tax Lien Sale: How Homeowners Avoid It

In the NYC lien sale, the City sells overdue property taxes, water and sewer charges, and certain HPD repair charges to an outside buyer, who can then add a 5% surcharge, charge interest compounded daily and eventually foreclose. A one- to three-family home is only at risk once it owes at least $5,000 in property taxes for three years or more (or, for two- and three-family homes, $3,000 in water charges for a year), and you can stay out by paying, signing a payment plan or getting a qualifying exemption before the deadline on your notice.

A lien sale is not a sale of your home. But it moves your debt from the City, which offers plans and hardship programs, to a private lienholder whose costs and remedies are harsher. Here is how to tell if you’re at risk and how to get off the list.

Which debts can be sold

The Department of Finance (DOF) runs the sale. It can include unpaid property taxes, water and sewer charges billed by DEP, and HPD charges from the Alternative Enforcement Program (AEP) and Emergency Repair Program (ERP) posted on or after January 1, 2006, plus accrued interest. Each type has its own threshold:

For a one-family home that owes only water and sewer charges, the City doesn’t sell a lien, but DEP may shut off service. DEP also says HDFC condos and co-ops are not eligible for the water lien sale. Abandoned properties and repeat sales can follow different rules.

Exemptions that keep you out

Some property tax exemptions exclude a property from the sale entirely. DOF says an approved exemption can even cancel a sale if it is approved within 90 days after the sale date.

If you’re 65 or older or have a disability and haven’t applied, check the SCHE/DHE checker now. It can lower your taxes and protect you from the sale at the same time. Active-duty military members can request exclusion with DOF’s Military Request for Relief form.

How to get off the list

If you’re at risk, DOF mails warning notices 90, 60, 30 and 10 days before the sale, each with a deadline to act. You have these options:

1. 1

   Pay at least the minimum on your notice

   The notice shows the minimum amount that removes you. This applies even if you’re disputing your assessment or charges; if you win, you get a refund.
2. 2

   Sign a payment plan

   DOF’s standard plan is open to any owner: 1 to 10 years, no required down payment, billed monthly or quarterly. Owners of a class 1 home or condo unit that has been their primary residence for a year, with federal adjusted gross income of $110,750 or less, may qualify for PT AID, which can defer payments or cap them at a share of income. A Circuit Breaker version applies if the tax is more than 10% of income and the assessed value is $250,000 or less. Water debts need a separate agreement with DEP (718-595-7890).
3. 3

   Apply for a qualifying exemption

   SCHE, DHE, Circuit Breaker or the veterans exemption, as above. Not-for-profit owners can apply for their exemption too.
4. 4

   Use the Lien Sale Easy Exit Program

   Removes you for one year if you own a 1-3 family home or condo unit, it has been your primary residence for 12 months, you own no other NYC property, and combined income of all owners and resident spouses is $107,300 or less. You must send recent tax returns or proof of income.
5. 5

   File an Emergency Repair certification

   If you only owe HPD Emergency Repair charges on a 1-3 family class 1 home that is your primary residence, you can be removed for one year.

For water charges, the Water Board’s rules add two protections: signing an installment agreement with DEP cancels the proposed sale of that lien, and a complaint or appeal that is still undecided when the 90-day list is issued keeps those water charges out of that sale. See NYC water and sewer bills.

When is the next sale?

The most recent sale on DOF’s page was held June 3, 2025, with a deadline to act of June 2, 2025. When we checked on October 12, 2026, DOF had not posted a date for the next sale. The first sign that you’re included is the 90-day notice, so open any mail from DOF or DEP, and keep your mailing address current with both. You can also browse Roofy’s tax lien sale list report to see which kinds of properties land on the list.

What happens after a lien is sold

1. Sale date

   Debt moves to the lienholder

   You now owe the lienholder, not the City. Keep paying new taxes and charges to the City.

2. Within 90 days

   City letter

   DOF mails the terms of the sale and names the lienholder and its authorized representative. Only deal with that representative.

3. Immediately

   Costs added

   A 5% surcharge on the entire lien, about $300 in administrative costs, and interest compounded daily and payable every six months: 6% (assessed value ≤ $250,000), 9% (up to $450,000) or 16% (above).

4. 30 days after a missed interest payment

   Early foreclosure possible

   Also possible if current taxes or charges stay unpaid for six months.

5. 1 year after the sale

   Foreclosure can begin

   If the lien isn’t paid in full or covered by a payment agreement with the lienholder.

Once a lien is sold you can’t start a DOF payment plan for it; you negotiate with the lienholder. Owner-occupants who meet DOF’s conditions (primary residence for 12 months, no other NYC property, combined income of $110,750 or less) can request a waiver of the 5% surcharge.

Quick self-check

• Pull your account and bills from DOF and add up overdue property tax. Is it near $5,000 and three years old?
• Check DEP for overdue water. For a two- or three-family home, is it near $3,000 and a year old?
• Look for HPD emergency repair or AEP charges on your bill.
• Do you qualify for SCHE, DHE, a veterans exemption, PT AID or Easy Exit?
• If you’re behind on the mortgage too, read behind on your mortgage in New York for free counseling options.

Understand your bill and due dates in how to read and pay your NYC property tax bill, and estimate what late interest is costing you with the late interest calculator. Homes with debt problems are also targets for scams, so read deed theft protection before signing anything a stranger offers.