New York City is ramping up for another round of property tax lien sales. Could your home be on the auction block next? How can you save it?
The last day to settle your NYC property tax bill this year is May 11th, 2016. Tax liens are sold the very next day. While some are vainly hoping to receive tax rebate checks in the mail, many could have liens attached to their homes, which may be sold.
After property taxes become late they eventually become liens. The liens are sold to investors eager to earn great interest returns on their investments. If property owners can’t pay those accruing fees the investor can ultimately own the property for the amount they purchased the lien for. Often that means picking up New York properties for just pennies on the dollar.
In some cases unsuspecting homeowners have lost their properties for less than $10 in junk fees they didn’t know they owed, or was even erroneously applied to their homes. With so much on the line no one can sit idle and ignore the situation. And just because you may pay money to your mortgage company each month, don’t automatically assume that they are doing their jobs and are paying them on time.
So what can you do to save your home?
NYC property owners can check this website for a list of properties eligible for the net tax sale to see if they are on it.
If you are behind on your property taxes or fear you can’t keep up, your options include…
Pay Them
Borrow the money, switch your spending around so that you can free up more cash, or see if you can tap other funds due to ‘hardship’ status and take care of that bill immediately.
Set Up a Payment Plan
Tax authorities are eager to bring in revenues. When they have to foreclose and seize properties to pay their bills they will. That can also bring them extra costs and risks. Unless there is a lot of equity in the home or it is on a prime property someone really wants, it is in their best interest to allow a payment plan. Take advantage of that.
Refinance Your Home
If you are strapped for cash then refinancing your home may be the best move. You can refinance an existing loan and perhaps lower your payments, skip a payment, and get cash back. Seniors may be able to access equity and receive payments to them every month with reverse mortgages and reverse mortgage home equity lines.
Sell Your Home
Those that cannot take advantage of any of the above may have no better option than to sell their NY homes. Sooner is better in order to beat accruing interest and fees which may eat up any equity.
Challenge Your Property Taxes
Before you do any of the above make sure you aren’t being overcharged for property taxes or related fees. It would be a tragedy to lose your home, wipe out your 401k, or pay thousands in fees, if you don’t even owe that money. Talk to a local property tax adjuster. Have them check your bill and tax assessment, and they may find you are even owed a rebate.