Title issues
Judgment lien against the seller
A docketed money judgment attaches to New York real property the seller owns in that county. Here is how it surfaces, how it clears, and who pays it.
What happens if there is a judgment against the seller?
Quick Answer
Lien · Blocks the closing until it is resolved
How is it found?
- The judgment search returns a docketed judgment against a name matching the seller in that county
- The search returns a name that only resembles the seller, which is the common false positive
- A federal tax lien or a state warrant appears alongside the docketed judgments
- An unpaid penalty from OATH (formerly ECB) has been entered as a judgment and shows in the municipal search
How is it cured?
- Confirm identity first, because a same-name hit is more common than a real lien; an affidavit of identity resolves most of them
- Where the judgment is the seller’s, obtain a payoff figure from the judgment creditor and pay it from the seller’s proceeds at closing
- Record the satisfaction of judgment promptly so the docket clears rather than merely going quiet
- Where the judgment is contested, move to vacate it or bond it so title can pass while the dispute continues
- Where the judgment is stale, check whether the lien period has run before treating it as live
What does clearing it cost?
A same-name false positive costs an affidavit and the time to prepare it. A real judgment costs its full payoff, including post-judgment interest, which accrues and is why the figure is pulled close to the closing date rather than at contract. Vacating or bonding a contested judgment is motion practice.
Who pays for it?
The seller. A judgment against the seller is the seller’s debt, and the standard New York contract obligation to convey marketable title puts the cost of clearing it on the seller, ordinarily out of the closing proceeds.
Does a judgment against the seller stop the sale?
It stops a sale free of the lien, which is what the contract requires. In practice most sales still close on time because the payoff comes out of the seller’s proceeds at the table. The sale stalls when the payoff exceeds the equity, or when the seller disputes the judgment.
What if the judgment belongs to someone with the same name?
That is the frequent outcome, not the rare one. Judgment searches run by name, so a common name returns strangers. The fix is an affidavit of identity from the seller, supported by identifying detail, confirming the seller is not the judgment debtor. It is routine and it is not a defect.
Do unpaid OATH penalties become judgments?
Yes. An OATH penalty that goes unpaid, or a hearing that is defaulted, can be entered as a judgment the City enforces. It then surfaces in the municipal search like any other lien, and it is commonly satisfied or escrowed before a transfer closes.
What else should you read before closing?
In the glossary
- Judgment lienA lien created by docketing a money judgment against the owner. It reaches real property in the county of docketing and is a routine payoff item at...
- LienA claim against property securing payment of a debt. Liens rank by priority, and closing normally means paying or releasing every one ahead of the ...
- ECB judgmentThe judgment entered on an unpaid or defaulted summons heard at OATH (formerly ECB). It is a collectible City debt tied to the respondent and to th...
- Marketable titleTitle a reasonable buyer would accept, free of defects that would expose that buyer to litigation. Most New York contracts require the seller to co...
- Title searchThe records examination behind a title report, covering the chain of title, encumbrances and court filings against the owners. It precedes the comm...
- Escrow (at closing)Funds or documents held by a neutral party until stated conditions are satisfied. At a New York closing it usually means a holdback from proceeds u...
Questions this raises
- What happens if the title search finds a problem before closing?Schedule B-I requirements are the punch list, not a dead deal. How New York closings clear old liens, missing satisfactions and name hits before th...
- What does title insurance cover?Old liens, recording errors, forged deeds, undisclosed heirs, easements: what a New York title policy covers, what Schedule B excludes, and how cla...
- What is curative title work?Curative work clears Schedule B-I before closing: payoffs, missing satisfactions, heirship affidavits, ACRIS indexing fixes and escrow holdbacks in...
Title issues
- Unsatisfied mortgage of recordA paid-off mortgage with no recorded satisfaction still reads as a live lien in ACRIS. Here is how it is found, how it is cleared, and who pays for...
- OATH (formerly ECB) judgment lienAn unpaid summons from OATH, formerly ECB, becomes a docketed judgment the City enforces against the property. How it is found, cured, and who pays...
- Lis pendens (notice of pendency)A notice of pendency warns the world that litigation could affect title. What a lis pendens does to a New York closing, how it comes off, and who p...
- Name variance and identity discrepancyThe deed in reads one name and the deed out reads another. How a New York title search treats a name variance, how it clears, and what it costs to ...
Closing checklists
- Estate sale closing checklistSelling a decedent’s New York property turns on the fiduciary’s authority: letters, the estate tax lien, the executor’s deed and Surrogate’s Court ...
- Residential sale closing checklistWhat a New York seller has to deliver: payoff letters, the deed, the affidavit of title, transfer tax returns, cured violations and marketable title.
Zoning and land use
- What a zoning problem does to a pending closingA zoning problem is usually not a title defect, which is exactly why it is dangerous. It reaches the deal through the contract, the lender and the ...
- Legalizing an illegal conversionExtra units the certificate of occupancy does not show are an illegal conversion. There are two honest exits: legalize the unit, or remove it and p...
- Certificate of no harassmentFor covered buildings, HPD must certify no tenant harassment before DOB issues a demolition or major alteration permit. It is a hard gate on the sc...
The statute itself
The violation code
- DOB violation b1g2 unlawful acts failure to comply with a law rule orWhat the code section requires and how it is cured
- DOB violation b187 unlawful acts failure to comply with commissionersWhat the code section requires and how it is cured
- DOB violation b263 failure to comply with the commissioners order to What the code section requires and how it is cured
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Legal Disclaimer: This page is general information about New York practice. It is not legal advice, it does not account for the terms of any particular contract, building or transaction, and reading it does not create an attorney-client relationship. This is attorney advertising. Prior results do not guarantee similar outcomes.