What is the Mortgage Recording Tax in NYC? How much is the Mortgage Recording Tax and how is it calculated? Who pays the Mortgage Recording Tax and is it negotiable? How can you reduce your tax liability with a purchase CEMA loan? Where do you file MT-15 (Mortgage Recording Tax Return)?
The mortgage recording tax in NYC is a transaction tax levied by New York State and New York City on all new mortgages funded. The mortgage recording tax in NYC is a percentage of your loan size, and applies to new mortgages for acquisitions as well as refinancings. The mortgage recording tax in NYC only applies to mortgage debt on real property, meaning condos, townhouses, multi-family properties, etc.
Co-ops Are Not Real Property
The mortgage recording tax is not applicable for loans backed by co-op apartment shares since coops are not considered to be real property. Furthermore, the Mortgage Recording Tax only applies if the purchaser will be utilizing financing. No tax is due for all cash purchases made without a mortgage.
The Mortgage Recording Tax in NYC varies depending on the size and classification of the mortgage, and is composed of both a New York City tax as well as New York State’s Basic Tax, Special Additional Tax and Additional Tax. The rates are as follows:
All mortgages with initial loan balances less than $500,000
2.05% of the initial mortgage principal (includes a 1% New York City tax)
Mortgages of one to three family houses and individual residential condo units with initial loan balances of $500,000 or more
2.175% of the initial mortgage principal (includes a 1.125% New York City tax)
All other mortgages with initial loan balances of $500,000 or more
2.8% of the initial mortgage principal (includes a 1.75% New York City tax)