Behind on Property Taxes in the Hudson Valley? Sell Before the Tax Sale

New York Property Tax Foreclosure — What the Hudson Valley Homeowners Need to Know

Falling behind on property taxes in New York triggers a specific legal process that, if left unaddressed, can end with you losing your home through tax foreclosure. New York does not use Pennsylvania-style "upset" and "judicial" tax auctions. Instead, delinquent real estate taxes are collected and foreclosed under New York's Real Property Tax Law (RPTL Article 11), almost always through the in-rem foreclosure procedure under RPTL Article 11.

The good news: you have more time than you think to act, and selling before the redemption deadline can get you a fair price for your equity. Acting early is everything.

How New York In-Rem Tax Foreclosure Works

Step 1 — Tax certificate and delinquency

When property taxes aren't paid, the county (or the City of the Hudson Valley for city parcels) issues a tax certificate around September 1, which is the legal foundation for later foreclosure. Interest runs at 1% per month (12% per year), and a penalty of up to 0.5% per month may apply, so balances grow quickly. You can stop the process at this stage simply by paying what's owed or arranging a payment plan with the treasurer.

Step 2 — In-rem petition and published notice

After taxes have generally been delinquent for about two years, the treasurer files an in-rem foreclosure petition and a list of tax liens with the clerk of the State Supreme Court under RPTL Article 11. Notice is published in a local newspaper for three consecutive weeks, and owners of record are notified. This opens the redemption window.

Step 3 — Redemption period (at least 8 weeks)

From the first published notice you have at least 8 weeks to redeem — to pay all delinquent taxes, interest, penalties, and costs to the treasurer and keep your home. This is the critical window. As long as you redeem before the deadline, you keep the property; this is also the period in which you can sell and pay the taxes from the proceeds.

Step 4 — Judgment of foreclosure

If no one redeems by the deadline, the court enters a judgment of foreclosure and title vests in the county or city. There is no post-judgment redemption in New York — once judgment is entered, the home is gone. A $250,000 Hudson Valley home can be lost over a few thousand dollars in back taxes, which is why acting during the redemption window matters so much.

Surplus Proceeds After Tyler v. Hennepin

For years, owners who lost property to tax foreclosure could lose all their equity, not just the taxes owed. That changed with the 2023 U.S. Supreme Court decision in Tyler v. Hennepin County, which held that keeping equity beyond the tax debt is an unconstitutional taking. Under New York's 2024 amendments to RPTL Article 11 (L. 2024, ch. 55, pt. BB), a former owner can now generally claim the surplus proceeds — the value above the taxes and costs — when the foreclosed property is later sold. The deadlines and paperwork are strict, though, and you'll almost always keep more by selling on your own terms before judgment than by trying to recover a surplus afterward.

How to Stop a New York Tax Foreclosure

New York homeowners have several ways to stop or avoid an in-rem foreclosure:

• Redeem (pay the delinquent taxes): You can pay everything owed to the treasurer up until the redemption deadline. Contact the Westchester County Treasurer directly to confirm the exact payoff figure and deadline for your parcel.
• Enter an installment payment plan: The Westchester County Treasurer can set up installment agreements on delinquent real estate taxes. Staying current on an approved plan generally keeps a parcel out of in-rem foreclosure.
• File for bankruptcy: An automatic stay under Chapter 7 or Chapter 13 halts foreclosure activity. Chapter 13 lets you repay delinquent taxes over a 3–5 year plan. Consult a bankruptcy attorney — this is a significant decision with long-term consequences.
• Sell the property before judgment: Often the best option for homeowners with equity. A cash sale pays off the delinquent taxes at closing and you receive whatever equity remains — far better than losing everything to a judgment of foreclosure.

STAR credit and Property Tax Relief

New York offers several property tax relief programs that Hudson Valley homeowners may not be fully utilizing:

• STAR credit: A state credit for lower-income homeowners and renters, administered by the NYS Department of Taxation and Finance at tax.ny.gov. It's based on household income and property taxes (or rent) paid.
• STAR credit: Reduces the property tax bill on your primary residence. It's applied through the county — confirm you're receiving it with the Westchester County Treasurer if the home is your primary residence.
• Enhanced STAR exemption: A credit applied to taxable real estate parcels with improvements, automatically reflected on the tax bill.
• Installment payment plans: The Westchester County Treasurer can arrange installment agreements on delinquent taxes — contact the county Department of Finance to ask about terms before an in-rem foreclosure begins.

Tax Liens vs. Tax Sales — Understanding the Difference

A tax lien is placed on your property when taxes go delinquent. It attaches to the title and must be paid before the property can be sold with clear title. This is different from a tax sale, which is the actual forced sale of the property. Simply Sold RE can purchase properties with tax liens — the lien is paid off at closing from the proceeds, just like a mortgage would be. You don't have to resolve the lien before calling us.

the Lower Hudson Valley Resources for Delinquent Property Taxes

Selling a Tax-Delinquent Home in the Hudson Valley — How It Works

If your Westchester County home has delinquent taxes and you want to sell before losing it to foreclosure, here's how the process works with Simply Sold RE: We research the exact tax delinquency balance with the County Treasurer, factor it into your net proceeds calculation, and close the sale with the delinquent taxes — plus any mortgage balance and other liens — paid directly from proceeds at closing. You walk away with whatever equity remains, the tax lien is cleared, and the in-rem foreclosure never reaches judgment. Call (914) 000-0000 — even if the sale date is weeks away, we can often close in time.

Westchester County Tax Payment Plans and Relief Programs

Before considering a sale, exhaust every available relief option. Westchester County and New York offer several programs that may allow you to address delinquent taxes without losing your home:

How Selling to Simply Sold RE Clears Tax Liens

Here's the practical mechanics of how a cash sale resolves property tax delinquency:

1. We make a cash offer based on current market value and condition — independent of your tax situation.
2. The title company runs a title search that identifies all outstanding liens, including delinquent taxes, mortgages, HOA arrears, and any other encumbrances.
3. At closing, all liens are paid from sale proceeds before you receive anything. If you owe $18,000 in back taxes and have a $40,000 mortgage balance on a home we're purchasing for $110,000, the title company pays the County Treasurer $18,000 and the lender $40,000 — and you receive the remaining $52,000.
4. The County Treasurer issues a lien release and the title company records clear title to the new owner.

You don't need to resolve the tax lien before contacting us or before closing. The resolution happens automatically at the closing table. The key is acting before the judgment of foreclosure — because after that, the equity that would have paid your debts and left you with something is gone.

Real Properties We've Purchased

These are actual homes we've bought across the Lower Hudson Valley — not stock photos or hypotheticals. Click any project to see the full story.

City Citations · Closed Before Escalation

Victorian Estate — Ossining, NY

Active city citations and fines for exterior violations. The sellers needed to close before further code enforcement escalation — we did.

Read the full story →

Lien Cleared at Closing

Probate Lien Double — White Plains, NY

A probate lien was blocking the title. We worked with a probate attorney to clear it — the seller didn't have to manage any of it.

Read the full story →

View all projects →