What is the Real Estate Tax Receivership program?
For properties with outstanding tax debts, the City of Philadelphia has the right to request that the Common Pleas Court to appoint someone to collect rents, manage a property and pay its expenses, including current and delinquent taxes, until any debts to the City are paid off. It is similar to a receiver being appointed when a business is bankruptcy or a mortgage is in default and is also referred to as Sequestration.
How can I stop Real Estate Tax Receivership?
You can prevent Real Estate Tax Receivership before the Court appoints a Receiver by paying your delinquent bills or by entering into and remaining current on a City-approved payment agreement.
What do I do if I cannot pay in full?
Contact us at 215-686-0306 to determine if you are eligible for an installment payment plan.
What is the process for appointing a Receiver?
The City will notify you by certified mail to alert you that it will be requesting that the Court appoint a Receiver. If you do not make arrangements by the date stated in the letter to take care of your debts, the City will file a petition with the Courts.
What happens after the Receiver is appointed?
The Receiver will be authorized by the Court to direct you to turn over the keys, leases and other information about the property to the Receiver.. The Receiver will contact tenants and let them know that they are now the point of contact for building issues and that rents will now be sent to them. The Receiver will manage the property until the delinquent taxes and all management fees are paid.
Are there any additional fees associated with Receivership?
Yes. The Receiver appointed by the Courts is entitled to a management fee, which will be paid out of the rents collected from the property. These fees, along with the delinquent debts, must be repaid before the management of the property can be returned to the owner.
Do I still own my property? Can I sell it, lease it, or refinance it during Receivership?
During Receivership, the ownership of the property stays the same as before the Court appoints the Receiver; however all decision about the sale, lease or financing of the property will be made by the Receiver, in consultation with the City and the Court.
Can I get a payment plan or reduction in the amount due?
If you cannot pay in full, contact the case manager assigned to your account, who will review eligibility for a payment plan. You may call 215-686-0306.
Is Real Estate Tax Receivership legal?
Yes, under Pennsylvania’s Municipal Claims and Tax Liens Act (53 P.S. § 7275), the City has the authority to appoint a receiver (also known as a Sequestrator).
Will the Receiver pay my mortgage?
Probably not. The City has the statutory authority to have its Real Estate Taxes paid before anyone else, except the Receiver’s fees. The Receiver will also pay expenses related to operating the building, provided that funds are available from the rents collected. Failure to pay your debt to the City and winding up in receivership may lead to mortgage default.
Nobody is going to pay rent on this property, how do you expect to get money?
The Receiver, an experienced manager of troubled properties, has the power to make improvements, enter into leases, and even sell the property if that is what is necessary to get the debt repaid.
The reason I haven’t paid is that my tenants owe me back rent. Will you get them to pay?
The Receiver will direct the tenants to pay. If they do not, the Receiver will remove the tenants and install new ones.
Once the Receivership ends, am I stuck with the tenants and lease terms that the Receiver puts into place?
Yes, however the Receiver may only enter into leases of up to one year.
I live in a property and heard there is now a Receiver. Is this legit and what does that mean to me?
To check the Receivership status of a particular property, please call 215.686.0306.
How do I pay my delinquent taxes?
To make payment, use the payment coupon sent to you in the mail, visit http://www.phila.gov/revenue/realestatetax/ to pay by e-check, credit, or debit card, or call 877-309-3710 to pay by credit card. Payments are also accepted in the Concourse of the Municipal Services Building at 1401 John F. Kennedy Boulevard, Monday-Friday 8:30am to 5:00pm.