New York City sells delinquent property tax debt to a third-party trust each year through the lien sale. Once your lien is sold, interest piles up at 18% compounded daily — a small balance can become unmanageable in a few years.
You can still sell the house after the lien is sold. At closing, the title company pays off the lien from the sale proceeds and you keep whatever equity remains. You do not need to clear the lien before going to contract.
What matters is acting before the lien holder forecloses. Once a foreclosure judgment is entered, you can lose the property entirely along with any equity above the debt. Selling earlier — even at an as-is price — almost always preserves more value than waiting.
If you're getting lien-sale notices from the NYC Department of Finance, the worst move is to ignore them. The earliest options are always the best ones.