Guide · Selling in foreclosure, New York
Selling a House in Foreclosure in New York
The short answer
Yes. You own the property until the referee's auction, so you can sell it until then. The sale must close before the auction because New York gives no right to redeem afterward. If you live in the home and are in default, New York's Home Equity Theft Prevention Act gives you strong protections, including at least five business days to cancel a sale contract with certain buyers.
How do you sell a house in foreclosure in New York?
- Get your payoff letter. Ask your lender for the exact amount to pay off the loan on a given date.
- Find out where the case stands. Know whether a judgment has been entered and whether an auction date is set.
- Run the numbers. Compare the payoff, other liens and closing costs with a realistic price. If you owe more than the property is worth, you will need the lender to approve a short sale.
- Choose how to sell. List with an agent, sell directly to a buyer, or ask the lender about a short sale. A settlement conference is a good place to raise a short sale.
- Close before the auction. The title company pays your lender and liens from the sale and pays the rest to you.
What protections do New York homeowners have when selling in foreclosure?
New York's Home Equity Theft Prevention Act, Real Property Law section 265-a, protects people who live in a one to four family home that is in default or foreclosure. When it applies to a sale:
- The contract must be in at least 12-point bold type.
- You have at least five business days to cancel.
- During those five days the buyer cannot record documents, take the deed or pay you.
- If the deal lets you rent the home back or buy it back later, the buyer generally must pay at least 82 percent of fair market value.
- A sale that breaks these rules can be undone, and you can sue for damages.
Sales to someone who will live in the home as their own residence are among the exemptions, so ask an attorney whether the law covers your sale.
Does Dror Partners buy houses in New York?
Yes, but only investment and vacant property. We do not buy homes in New York from owners who live in them. If you live in the home, New York's free Homeowner Protection Program at 855-HOME-456 can connect you with a counselor or legal services, and a listing agent or short sale may fit your situation.
How do you spot a foreclosure rescue scam in New York?
Walk away from anyone who asks you to sign over your deed and promises you can rent it back and buy it later, wants money before doing any work, tells you to stop talking to your lender or your attorney, or claims to be connected to the government or the court. New York also regulates paid foreclosure consultants under Real Property Law section 265-b, which bars them from collecting fees before the work is finished and from encouraging you to transfer your deed.
Common questions
Can I sell my house after a judgment of foreclosure in New York?
Yes, until the referee's auction. A sale that closes and pays the lender before the auction ends the foreclosure. After the auction, New York gives no right to redeem.
Do I get time to cancel if I sign a contract to sell my house in foreclosure in New York?
If you live in the home and the Home Equity Theft Prevention Act applies, you have at least five business days to cancel, and the buyer cannot pay you, record documents or take the deed during that time.
Do you buy homes in New York?
Dror Partners buys only investment and vacant property in New York. We do not buy homes from owners who live in them.
Do I need my lender's permission to sell?
Not if the sale price covers the full payoff. If it does not, the lender must approve a short sale.
Where can New York homeowners get free foreclosure help?
The New York Homeowner Protection Program at 855-HOME-456 connects homeowners with free housing counselors and legal services.
Need loan terms or a cash offer?
In New York, Dror Partners buys and lends on investment and vacant property only. Tell us about the property and we will tell you plainly whether it fits.
Request terms or an offerSources
This guide is general information about New York law and practice, not legal advice. Dror Partners is not a law firm or a foreclosure consultant. For advice about your case, speak with a New York attorney or the free New York Homeowner Protection Program at 855-HOME-456.