State Foreclosure Law Library

new-york

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New York — Tax & Mortgage Foreclosure

Legal information, not legal advice. Verify against the cited primary sources before acting. Last verified: 2026-06-01.

New York is the structurally unusual case in the post-tyler-v-hennepin-county landscape: from 1995 until 2024 its Real Property Tax Law (RPTL) Article 11 in rem tax-foreclosure scheme gave the foreclosing tax district fee simple absolute in the parcel — including 100% of any equity above the tax debt, with no surplus distribution at all. Tyler v. Hennepin County (2023) rendered that unconstitutional, and New York rewrote Article 11 in 2024 (L.2024, ch.55, pt.BB), adding a brand-new Title 6 — Distribution of Surplus (RPTL §§ 1196–1197), retroactive to Tyler’s decision date of May 25, 2023. Surplus practice in New York is therefore very new and still being litigated.

0. Identity & Classification

  • Recording unit: county (62 counties; New York City’s five counties/boroughs enforce under their own NYC Administrative Code in rem scheme rather than RPTL Art. 11). Count: 62 counties.
  • Tax sale type: Tax deed via in rem foreclosure (not a lien-certificate state in the Florida/Arizona sense). The county/tax district forecloses the tax lien in a judicial in rem proceeding and the property is then deeded or sold; some counties also conduct tax-lien sales by local law (e.g., NYC sells liens to a trust). Classify as tax_deed with judicial in rem process.
  • Tax foreclosure process: judicial (in rem) under RPTL Art. 11, Title 3 (§§ 1120–1137). RPTL Art. 11
  • Mortgage foreclosure process: judicial only (New York has no power-of-sale / non-judicial mortgage foreclosure). RPAPL Art. 13. RPAPL Art. 13
  • Selling authority: the enforcing officer of the tax district (typically the county treasurer / commissioner of finance; in some jurisdictions the county attorney prosecutes the proceeding).
  • Statutory home: RPTL Article 11 (§§ 1100–1198) — Procedures for Enforcement of Collection of Delinquent Taxes. Justia: RPTL Art. 11
  • Tyler v. Hennepin compliance: reformed_post_Tyler. The pre-2024 scheme (district keeps all surplus) was non-compliant; L.2024, ch.55, pt.BB added RPTL §§ 1196–1197 creating a surplus determination and claim process, retroactive to May 25, 2023. Phillips Lytle review

1. Tax Sale Mechanics

  • What is sold: the parcel itself, by deed, after an in rem judgment of foreclosure (RPTL § 1136). Pre-2024 the district simply took title; post-reform a district may take title, sell at public auction, transfer to a third party, or convey back to the former owner on payment of arrears. RPTL Title 3
  • Bidding method: where a public auction is held, highest-bid deed (premium bidding); there is no statewide bid-down-interest mechanic because the lien itself is not auctioned in the Art. 11 scheme.
  • Interest / penalty on delinquency: 1% per month (≈12% per annum) under RPTL § 924-a, the default statewide rate “for each month or fraction thereof until such taxes are paid”; unchanged since 1983. Some special districts/cities set their own rates outside § 924-a. NY Tax Dept § 924-a · RPTL § 924-a
  • Minimum bid composition: the total of delinquent taxes, accrued interest at the § 924-a rate, penalties, and other charges as defined by RPTL § 1102.
  • Sale frequency / typical month: varies by county; the enforcing officer executes the petition of foreclosure 21 months after lien date (33 or 45 months for parcels with extended 3- or 4-year redemption periods) under RPTL § 1123, with sale after judgment. No single statewide auction month. RPTL § 1123
  • Venue: both in-person and online, by county.
  • Platform vendors: varies by county (commonly Auctions International and similar vendors for upstate counties). County-specific — see county pages.
  • Registration / deposit: set by the county conducting the auction.
  • Subsequent taxes (“subs”): not applicable in lien-certificate form; ongoing taxes continue to accrue against the parcel until the in rem judgment.

2. Right of Redemption → see right-of-redemption

  • Pre-sale / pre-judgment right: Yes. Under RPTL § 1110, real property subject to a delinquent tax lien may be redeemed by paying the enforcing officer the full delinquent lien plus all charges authorized by law, on or before the expiration of the redemption period. RPTL § 1110
  • Redemption period: two (2) years after lien date by default (RPTL § 1110). A tax district may extend the period for residential or farm property (§ 1111), or reduce it to one (1) year for residential vacant-and-abandoned property placed on a vacant/abandoned registry before the taxes became delinquent (§ 1111-a). If the § 1124 published notice specifies a later expiration date, that later date controls. RPTL § 1110
  • Who may redeem: any person with a right, title, interest, or equity of redemption in the parcel (owner, lienholder, mortgagee) — RPTL § 1110.
  • Amount formula: delinquent tax lien(s) + § 924-a interest + penalties + lawful charges (RPTL §§ 1110, 1102).
  • Premium to certificate holder: N/A (deed/in rem scheme; no certificate investor in the Art. 11 model).
  • Procedure: pay the enforcing officer; on a parcel listed under § 1122 the officer issues a certificate of redemption that is filed with the county clerk (RPTL § 1110).
  • Extinguishment: failure to redeem or answer by the redemption deadline bars and forecloses all right, title, interest and equity of redemption, and a judgment of foreclosure may be taken by default (RPTL § 1131). A motion to reopen a default may not be brought later than one month after entry of judgment. RPTL § 1131
  • Special tolling: redemption-period extensions for residential/farm property (§ 1111). General tolling for minors/incompetents and federal stays (bankruptcy-automatic-stay, scra-protections) — see needs_verification.

3. Surplus / Excess Proceeds → see surplus-funds, third-party-recovery-rules

  • Belongs to: priority waterfall (post-reform). Surplus is adjudicated and distributed “in the same manner as in an action to foreclose a mortgage” under RPAPL Article 13, so former owner equity is paid after senior liens. Before the 2024 reform, surplus belonged entirely to the tax district. RPTL § 1197
  • Surplus determination: within 45 days after the sale, the enforcing officer must determine whether a surplus exists and its amount — sale proceeds (or, for a non-public sale, full value per the tax roll, a licensed NY appraisal, or another reasonable valuation method) minus taxes + interest + penalties + § 1102 charges (RPTL § 1196). RPTL § 1196 · § 1196 (public.law)
  • Who may claim: any person who had a right, title, interest, claim, lien, or equity of redemption in the parcel immediately prior to the judgment of foreclosure (RPTL § 1197).
  • Filing venue: the court having jurisdiction over the in rem proceeding (the surplus claim is part of, and adjudicated within, the foreclosure proceeding), per RPAPL Art. 13 surplus-money procedure. RPTL § 1197
  • Claim deadline: a written claim may be filed before confirmation of the report of sale; for residential property with unclaimed surplus the proceeding remains open at least three (3) years from confirmation, and a former homeowner who files within that window is treated as timely (RPTL § 1197).
  • Escheat: unclaimed surplus is not remitted to the State Comptroller’s unclaimed-funds office; under RPTL § 1197 it is paid to the tax district and used to reduce its tax levy. (This is the opposite of the usual escheat-to-state rule and is the key reason the APL § 1416 finder cap below does not cleanly apply.)
  • Documentation required: written notice of claim stating the nature and extent of the claim and the claimant’s (or attorney’s) address; proof of pre-judgment interest. See county/court surplus-claim instructions.
  • Notice to former owner required? The 2024 reform created the surplus right but the Seelbach court (below) held there is no constitutional or statutory entitlement to particularized notice of surplus rights beyond ordinary § 1125 foreclosure notice — recourse for more notice is “to the Legislature.”
  • Third-party recovery (surplus-recovery agents):
    • fee_cap_pct: null / unsettled. New York’s only on-point statutory finder cap is Abandoned Property Law § 1416 = 15% of recoverable property — but that statute governs property held by the State Comptroller. RPTL surplus is held in court and (if unclaimed) goes to the tax district, not the Comptroller, so § 1416’s 15% cap does not plainly govern RPTL tax-foreclosure surplus. Flagged in needs_verification. APL § 1416
    • licensing_required: APL § 1416 imposes disclosure/validity rules on “abandoned property location services” for Comptroller-held funds; no separate statewide license is specified there. Applicability to RPTL surplus unsettled.
    • assignment_of_claim_allowed: not specified by RPTL Art. 11; surplus claims are litigated within the foreclosure proceeding under RPAPL Art. 13. Flagged.
    • cooling_off_period: none specified for RPTL surplus.
    • contract_disclosure_rules: for Comptroller-held funds, APL § 1416 requires a 12-point boldface disclosure that funds can be claimed directly without a fee, and voids fees above 15%. APL § 1416
    • prohibited_practices: APL § 1416 voids agreements with excessive/unjust consideration and those lacking required disclosures (Comptroller-held funds).
    • citation: Abandoned Property Law § 1416; RPTL §§ 1196–1197.

4. Mortgage Foreclosure

  • Process: judicial only. New York has no non-judicial/power-of-sale mortgage foreclosure; lenders must bring an RPAPL Article 13 action and obtain a judgment of foreclosure and sale. RPAPL Art. 13
  • One-action / election of remedies: RPAPL § 1301 — a lender may pursue the note or foreclose the mortgage but not simultaneously seek a money judgment and foreclose on the same debt (one-action rule, § 1301(3)). RPAPL § 1301
  • Timeline (days): highly variable (often well over a year given mandatory CPLR 3408 settlement conferences for home loans); no fixed statutory NOD/NOS clock like trustee-sale states. Flagged for precise figures.
  • Reinstatement right: borrowers may generally cure/reinstate before judgment; specific statutory section not separately verified — flagged.
  • Redemption after sale: None. New York recognizes the equity of redemption only up to the foreclosure sale; there is no post-sale statutory redemption period. RPAPL § 1352 (strict foreclosure) fixes/cuts off any remaining equity of redemption of omitted parties. RPAPL § 1352
  • Deficiency judgment: allowed with a mandatory fair-value offset. Under RPAPL § 1371, a deficiency motion must be made within 90 days after the deed delivery, and the deficiency equals the debt (plus prior liens, interest, costs) less the higher of the fair market value (as determined by the court) or the sale price. RPAPL § 1371
  • Surplus distribution: sale proceeds exceeding the judgment are paid into court and distributed via surplus-money proceedings by lien priority (RPAPL §§ 1354, 1361). RPAPL § 1361
  • Sale officer: referee appointed by the court (not a sheriff or trustee).

5. Sale Procedure Playbooks

  • Tax (in rem) sale — ordered steps → see treasurer-sale:
    1. Taxes become delinquent; § 924-a interest accrues at 1%/month.
    2. Redemption period runs (2 yrs default from lien date; § 1110).
    3. Enforcing officer executes the list of delinquent taxes (10 months after lien date; § 1122), then the petition of foreclosure (21 months after lien date — 33/45 months for extended redemption; § 1123), with mailed and published notice of foreclosure (§§ 1124–1125).
    4. Interested parties must redeem or answer by the deadline; default bars all interests (§ 1131).
    5. Judgment of foreclosure awards title/possession (§ 1136); property is sold at public auction or otherwise disposed.
    6. Within 45 days of sale, enforcing officer determines surplus (§ 1196).
    7. Claimants file; surplus distributed by RPAPL Art. 13 priority; residential proceedings stay open ≥3 years (§ 1197). RPTL Title 3
  • Mortgage / referee sale — ordered steps → see sheriff-sale:
    1. Lender files RPAPL Art. 13 complaint + lis pendens; CPLR 3408 settlement conference for home loans.
    2. Judgment of foreclosure and sale; referee appointed.
    3. Notice of sale published; public auction by referee.
    4. Referee distributes per RPAPL § 1354; surplus paid into court (§ 1361).
    5. Deficiency motion within 90 days with fair-value offset (§ 1371).
  • Notice requirements: RPTL §§ 1124–1125 require mailed notice to owners/interested parties of record and published notice; due-process adequacy governed by Mullane, Mennonite, Jones v. Flowers, and NY’s Kennedy v. Mossafa.
  • Upset bid / confirmation: tax in rem sale results are reported and confirmed by the court; surplus determination keyed to the report/confirmation (RPTL §§ 1196–1197).
  • Payment terms: set by the conducting county/court.
  • Deed issued: tax in rem judgment conveys title to the tax district / purchaser (RPTL § 1136); referee’s deed in mortgage foreclosure (RPAPL § 1353).

6. Due Process & Notice → see due-process-notice

  • Standard: notice “reasonably calculated, under all the circumstances, to apprise” interested parties of the proceeding and afford an opportunity to be heard (mullane-v-central-hanover standard, adopted by NY).
  • Required attempts: mailed notice to owners/lienholders of record (RPTL § 1125); where mailed notice is returned, NY requires reasonable additional steps — under Kennedy v. Mossafa (100 N.Y.2d 1 [2003]) and MacNaughton v. Warren County (20 N.Y.3d 252 [2012]) the enforcing officer must, when notice is returned as undeliverable, conduct a reasonable search of the public record (though it need not search the internet, telephone directories, voting/motor-vehicle records, or out-of-county/out-of-state records), consistent with jones-v-flowers. Mortgagees of record whose interests are reasonably ascertainable are entitled to actual (mailed) notice (mennonite-v-adams).
  • Consequence of defective notice: judgment/deed is voidable as to the party denied constitutionally adequate notice (the 2-year SOL to vacate a tax deed does not run against a party who never received due-process notice).
  • Leading cases: kennedy-v-mossafa, macnaughton-v-warren-county, matter-of-foreclosure-of-tax-liens-seelbach-2024, tyler-v-hennepin-county, mullane-v-central-hanover, mennonite-v-adams, jones-v-flowers.

7. Title & Marketability

  • Deed warranty level: tax in rem deed conveys whatever title the judgment vests (no warranties); referee’s deed in mortgage foreclosure likewise conveys without covenants.
  • Marketable immediately? Practically no — title companies typically require the in rem proceeding to be unassailable and often a quiet-title action or the running of the limitations period before insuring.
  • Quiet title required? Frequently, especially where notice to any interested party is questionable.
  • SOL to challenge the tax deed: a referee’s/tax deed becomes conclusive evidence of regularity after a limitations period (the NYSBA practice commentary describes a two-year period to set aside a referee’s deed), but that bar does not run against a party denied due-process notice. Exact RPTL section flagged for verification. NYSBA surplus article
  • Title insurance availability: available but usually only after curative steps (proof of regular service, expiration of challenge period, or quiet title).
  • Common defects: defective/returned-mail notice; omitted necessary parties (cured by RPAPL § 1352 strict foreclosure); unresolved surplus claims post-Tyler.

8. Case Law (real, verified)

CaseYearTopicHolding (plain English)Source
matter-of-foreclosure-of-tax-liens-seelbach-20242024surplus, due_process, tylerNY Supreme Court (trial): the mere pendency of an RPTL Art. 11 foreclosure does not itself risk a Takings violation under Tyler; owners have no constitutional or statutory entitlement to particularized notice of surplus rights beyond ordinary foreclosure notice — recourse for more notice is to the Legislature. (2024 NY Slip Op 24216)https://www.nycourts.gov/Reporter/3dseries/2024/2024_24216.htm
kennedy-v-mossafa2003due_process, sale_procedureCourt of Appeals: due process requires notice reasonably calculated to apprise the owner; the enforcing officer’s duty is not always satisfied by mailing to the tax-roll address — when mailed notice is returned undeliverable, the district must generally conduct a reasonable search of the public record, though on the facts (mail returned “unclaimed,” correct address) no further search was required and it need not hunt down a missing taxpayer. (100 N.Y.2d 1)https://nysba.org/due-process-and-due-diligence-claiming-surplus-in-new-yorks-in-rem-tax-foreclosures/
macnaughton-v-warren-county2012due_process, sale_procedureCourt of Appeals: where mailed notice to the property owners was returned undeliverable, the tax district must take reasonable additional steps — a reasonable search of its own public records — but need not search out-of-county/out-of-state or attempt personal service; on these facts the county satisfied due process. Refined the Kennedy v. Mossafa “reasonable search” duty. (20 N.Y.3d 252; 2012 NY Slip Op 08442)https://www.nycourts.gov/Reporter/3dseries/2012/2012_08442.htm
tyler-v-hennepin-county2023surplus, tylerU.S. Supreme Court: retaining surplus equity beyond the tax debt after a tax foreclosure is an unconstitutional taking; the owner must have an opportunity to recover the excess. Drove NY’s 2024 RPTL Art. 11 reform. (598 U.S. 631)https://phillipslytle.com/a-review-of-new-yorks-response-to-tyler-v-hennepin-county/

9. Edge Cases (state-specific notes)

  • bankruptcy-automatic-stay — A Chapter 13 filing before the redemption deadline can preserve/cure delinquent taxes; the automatic stay tolls the in rem proceeding. NY-specific tolling interaction with RPTL § 1110 deadline flagged for verification.
  • federal-tax-lien-redemption — The IRS retains a 120-day right of redemption under 26 U.S.C. § 7425 when a federal tax lien is junior and the U.S. is properly noticed; applies to NY tax/mortgage sales alike (federal law).
  • heirs-property — Co-owned/inherited parcels: each heir with an interest may redeem (RPTL § 1110) and claim a pro-rata share of any § 1197 surplus.
  • mortgagee-notice — Mortgagees of record whose interests are reasonably ascertainable must receive actual (mailed) notice (mennonite-v-adams); the NY return-mail duty to make a reasonable record search runs to all parties of record (Kennedy v. Mossafa; MacNaughton v. Warren County).
  • void-vs-voidable — NY treats a deed obtained without due-process notice as voidable by the un-noticed party notwithstanding the deed-challenge limitations period (Kennedy v. Mossafa line).
  • HOA super-priority / manufactured homes / SCRA — not separately verified for NY; flagged.

10. Operations

11. Meta

Legal information, not legal advice. This page summarizes statutes and cases as of the last_verified date and may be incomplete or out of date; New York’s surplus regime in particular is new (2024) and actively litigated. Verify against the cited primary sources and consult a licensed New York attorney before acting.

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