Can I Sell My House If I Owe Back Property Taxes in Pennsylvania?
Yes, you can sell your house in Pennsylvania even if you owe back property taxes or have a tax lien on it. At closing, the title company's search finds the unpaid taxes, and the debt is paid out of your sale proceeds before the buyer receives clear title. The real risk is not selling with back taxes, it is waiting: leave them unpaid long enough and a tax sale can take the decision out of your hands.
If you are behind on property taxes, you are not alone, and you are not stuck. A tax lien sounds like a wall, but in practice it is a bill that gets settled at the closing table. The lien attaches to the property, not to you personally, and it does not stop you from selling. What it does is make the sale paperwork more careful, because the buyer's lender and title company will want the property delivered with clear title.
What Happens to My Back Taxes When I Sell?
When you accept an offer, the title company runs a search of the property's records. That search turns up unpaid city or county taxes, water and sewer charges, and any recorded liens or judgments. At settlement, those amounts are paid out of your proceeds before the buyer takes title. The back taxes you owe come off your net check, the lien is released, and the buyer gets a clean title. You can also pay the taxes yourself before closing if you want to keep the numbers simpler, but you do not have to come up with the money up front.
How Long Before Unpaid Taxes Trigger a Tax Sale in Pennsylvania?
In most Pennsylvania counties, the clock is two years. Under the state's Real Estate Tax Sale Law, a property becomes eligible for an upset tax sale once its real estate taxes have gone unpaid for two successive years. At an upset sale, the property is sold subject to its existing liens. If it does not sell there, the county can petition the court for a judicial tax sale, which conveys the property free and clear of most liens and judgments. Either way, the owner's interest can be wiped out, so the two-year mark is a real deadline, not a distant one.
Philadelphia Runs Its Own, Faster Clock
Philadelphia does not follow the county upset-sale process. The City's Department of Revenue works under the Municipal Claims and Tax Liens Act, and if your real estate taxes are not paid in full or covered by a payment agreement by December 31 of the year they were due, the City can begin a tax foreclosure action in court. The property is then sold at a Sheriff's Sale, which in Philadelphia is held online. Owners receive warning notices along the way and can stop the sale by paying in full or entering a payment agreement, and even after a sale the former owner of record has nine months to redeem the property by paying the back taxes plus what the buyer paid. Relying on that redemption window is a gamble. Selling on your own terms is not.
What If I Owe More Than the House Is Worth?
Back taxes on top of a mortgage that exceeds the home's value is the situation that scares owners the most, and it is also the one where a plan matters most. You can still sell. If the sale price will not cover the mortgage and the tax lien together, a short sale lets you sell for less than what you owe with the lender's approval, and the tax lien is settled at closing just like any other debt. A short sale is not a free pass, but it is a controlled exit that typically damages your credit far less than a tax sale or foreclosure.
Does the Same Rule Apply in South Jersey?
Yes. In New Jersey, unpaid municipal taxes become a lien on the property, and the same closing rule holds: the lien must be paid from the proceeds before the buyer gets clear title. New Jersey municipalities can sell the tax lien or move to foreclose on it if the taxes stay unpaid long enough, so the advice is identical: sell before the lien forces the sale for you.
The Bottom Line
Back property taxes are a debt, not a dead end. They get paid at closing, and the sale proceeds are almost always enough to cover them when the home is priced and marketed properly. The danger is the calendar: two years of unpaid taxes in most Pennsylvania counties, or a December 31 deadline in Philadelphia, can put your home into a sale you never agreed to. Selling first keeps the decision, the price, and the proceeds in your hands. My sell-my-house page covers what a sale with back taxes and liens involves for Philadelphia and South Jersey owners, from the title search to the closing table.
If you are behind on property taxes and not sure what your home is worth or how to sell with a lien on it, tell me your situation and I'll give you a straight answer on the best path. No pressure, just an honest read from someone who helps distressed homeowners get sold before the county or the City makes the call for them.