Tips & Advice
Why are Property Taxes the Scariest Kind of Debt?
If you’re behind on your property taxes, you’re not alone—delinquent taxes are a challenge many homeowners face. Although they might seem like a small issue at first, unpaid property taxes can quickly escalate into a much bigger problem. The good news is that you have options, and the earlier you act, the better.
While missed mortgage payments or contractor liens can take months to lead to serious consequences, delinquent property taxes can stretch out for years, lulling homeowners into a false sense of security. However, property tax delinquency is one of the most dangerous financial pitfalls, as local governments can seize your property to recover unpaid taxes, often without protecting your equity.
In 2024, property tax delinquency rates in cities like New York were hovering around 2.2%, with some local governments adopting reauthorization programs that lower the risk of property seizure by offering extended payment options (CoreLogic®)(R&E Real Estate Law). The challenge, however, remains severe for many homeowners across the U.S.
Most government entities give homeowners a window of around two years to resolve delinquent taxes before initiating foreclosure proceedings. This timeline varies by state, but it offers you the opportunity to act. Consider refinancing your mortgage to free up funds, or selling your home to protect your equity.
For example, in New York, new programs allow property owners to defer taxes or remove their property from lien sale eligibility if they meet certain criteria, giving homeowners more time to find a solution (R&E Real Estate Law).
In 2024, national property tax delinquency rates have been stable, but local policies are shifting. Cities like New York and others across the U.S. are expected to see further changes in tax collection programs, with more municipalities introducing payment deferral options (R&E Real Estate Law)(National Association of REALTORS®). By 2025, some experts predict an increase in property tax collections as governments aim to recover funds lost during the pandemic (National Association of REALTORS®).
The key to managing delinquent property taxes is taking action early. Whether through refinancing, payment deferral, or selling your home, proactive steps can prevent foreclosure and protect your equity. At Frontdoor, we understand how stressful this situation can be. We’re here to help by providing a cash offer on your home within 24 hours and closing in as little as seven days, allowing you to settle debts and move forward. If you’re facing financial stress due to unpaid taxes, give us a call—we’re ready to help.
