The New York City Department of Finance holds an annual Tax Lien Sale every May. Past due taxes, water and sewer charges, and DOB and HPD charges are sold to large investors, who in turn have the right to bring about a foreclosure action on the property if arrangements are not made to pay off the outstanding debt. There are currently two servicing companies that manage these sold liens, Moorings Financial Corporation and Xspand.
Although there are many reasons why taxes and other charges remain unpaid by homeowners, the single most destructive action that a homeowner can do is to ignore the ongoing notices that are sent by the servicing companies. The two companies that service sold tax lines and the NYC Department of Finance are happy to work out payment arrangements with homeowners as long as you are honest and up front with them. After a period of time when the homeowner does not respond to ongoing communication from the servicing company, a foreclosure action is initiated against the property. The property is then sold at public auctions, to collect money to pay the outstanding debt. Property owners have the right to redeem the property up until the sale at the foreclosure, this is called the Equity Right of Redemption. These servicing companies base their actions on information provided by NYC Department of Finance. The information is often flawed and the homeowner has the right to challenge the foreclosure action even if the sale has taken place. The most important action you can take is to confront the foreclosure action head on. I can recommend attorneys that specialize in The New York State Foreclosure Process. If you have any questions about the program, I am always available to assist you.
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