Manhattan mortgage recording tax can create a large closing cost that has nothing to do with the apartment’s sticker price. The New York State and New York City mortgage recording tax is calculated from the debt secured by the mortgage. For a financed individual condominium, the practical buyer budget is usually 1.8% or 1.925% of the mortgage amount. This article uses the official 2026 rate framework and separates the amount a typical residential borrower budgets from the full statutory tax.
For general context, this Mortgage Recording Tax explainer offers useful background on mortgage-based calculation and CEMA. The official calculations below control; the linked background page contains a simplified NYC component, so check the rate against Form MT-15.
For a Manhattan mortgage-tax estimate before an offer, visit TheNewYorkCityBroker.com/contact-me.
Manhattan Mortgage Recording Tax: The Buyer’s Short Answer
A mortgage below $500,000 is often budgeted at 1.8% for the borrower-paid components when the lender pays the special additional tax. A mortgage of $500,000 or more is often budgeted at 1.925% if the lender bears the 0.25% component. Those figures combine the New York State basic tax, the New York State Metropolitan Commuter Transportation District additional tax, and the NYC mortgage tax.
The statutory totals are higher because the tax system also imposes a 0.25% special additional mortgage recording tax. An official NYS condo advisory opinion allocated 0.25% to the lender and 1.925% to the buyer on its specific facts. Tax Law Section 253 assigns the component according to the mortgaged property and mortgagee, so the allocation must be confirmed.
Therefore, the statutory totals are 2.05% below $500,000 and 2.175% at $500,000 or more.
The Debt, Not the Purchase Price
Mortgage recording tax is an excise tax on recording a mortgage against New York real property. It is not a tax on the purchase price. A $1.5 million condo with a $900,000 loan is taxed by reference to the secured mortgage obligation, not the full $1.5 million consideration.
For a named example of condominium classification only, the Attorney General record identifies 220 Central Park South as a Manhattan condominium offering. That record says nothing about a particular buyer’s loan or mortgage tax.
The tax is due when the mortgage is recorded. In Manhattan, the Office of the City Register records the mortgage through ACRIS. ACRIS provides the City’s official workflow for preparing documents, calculating taxes and fees, and submitting payment. A private calculator can be useful for an estimate, but it should not replace the official calculation.
2026 Rates and Who Pays
The Residential Rate Components
These figures illustrate one individual residential condo mortgage without a first-sale credit, exemption, CEMA, or unusual apportionment. The lender share must be confirmed so the buyer does not confuse a statutory total with the conditional borrower-paid amount.
For a mortgage below $500,000, the NYC component is 1.00%. Add 0.50% NYS basic tax, 0.30% MCTD tax, and 0.25% special additional tax: the statutory total is 2.05%.
At $500,000 or more on an individual residential condo, the NYC component is 1.125%. With those state components, the statutory total is 2.175%. In the official condo advisory example, the buyer paid 1.925% and the lender paid 0.25%.
The 0.25% allocation requires a fact-specific check under Tax Law Section 253. It is not a promise that every institutional loan or every property has the same payer. Confirm the lender, mortgaged premises, building facts, and current closing calculation.
The threshold is not a graduated rate. For a single mortgage, the entire principal moves into the higher NYC bracket at $500,000. Related mortgages can require aggregation under Tax Law Section 253-a. A $499,900 mortgage remains in the lower category. A $500,000 mortgage is in the higher category. The difference at that boundary is meaningful, so financing should not be modeled from a rounded purchase-price percentage.
The official form rounds the mortgage amount to the nearest $100 for its computation. A value of $50 or less rounds down, and a value greater than $50 rounds up. A lender or attorney may also identify specific tax adjustments, so these examples are planning guides rather than a substitute for the closing statement.
When the Lender Pays 0.25 Percent
The special additional tax is often described as the lender’s share because New York law assigns it to the mortgagee for qualifying residential property. The rule is designed for mortgages on property principally improved by a structure containing six or fewer residential dwelling units, subject to the statute’s mortgagee and property conditions. That is a statutory allocation, not a promise that every lender worksheet will display a separate credit. A natural-person mortgagee, a credit union, an exempt organization, a commercial property, or a larger multifamily building can change the result. The borrower should ask the lender and closing attorney how the 0.25% component is being handled.
For a condo loan where the lender bears the special component, the buyer-facing planning shorthand is 1.8% or 1.925%. Do not assume the same allocation for a larger multifamily property or another mortgagee. The complete statutory calculation remains 2.05% or 2.175%. Presenting both figures is more accurate than calling one figure the only mortgage tax rate.
Condo, House, and Co-op Differences
An individual residential condominium is deeded real property. If the buyer finances it, the mortgage is recorded against the unit and the mortgage recording tax normally applies. A townhouse or one- to three-family house is also real property, although the state $10,000 exclusion may affect one component for qualifying one- or two-family property.
A co-op buyer acquires shares in a corporation and a proprietary lease. The buyer’s apartment loan is a share loan secured by personal property and lease rights, not an individual mortgage recorded against the apartment’s real estate. Consequently, an individual co-op apartment loan generally does not create apartment-level MRT. No apartment-level MRT does not mean a co-op buyer has no closing taxes. Co-op share transfers can be subject to NYC real property transfer tax, New York State transfer tax, and buyer-paid mansion tax. The building can also have an underlying mortgage, and its financing is not the buyer’s share loan.
A cash condo buyer does not record a purchase mortgage and therefore incurs no buyer MRT on it, although other closing costs remain.
A Narrow $10,000 Exclusion
A separate first-sale condominium credit under Real Property Law Section 339-ee may apply where previously taxed construction or blanket-mortgage debt qualifies. It does not credit the 0.25% special additional tax. Ask closing counsel to test it before using these examples.
The $10,000 exclusion is narrower than many summaries suggest. It applies to the New York State additional tax component when the real property is principally improved or to be improved by a one- or two-family residence or dwelling. It does not reduce the basic tax, the NYC component, or the special additional tax.
The exclusion is not a general condo deduction. An individual residential condominium unit is not a one- or two-family dwelling for this particular state additional-tax exclusion. A qualifying house may receive the exclusion, but the closing professional must apply the statutory property and instrument rules.
The exclusion generally applies once to each mortgage that is not supplemental to a previously recorded mortgage. It does not automatically recur on a modification. A supplemental mortgage may need a Section 255 affidavit and a calculation showing the original mortgage details and taxes paid.
New Mortgage, Refinance, and CEMA
A new purchase-money condo mortgage is usually taxed on the full principal obligation secured at recording. A refinance that pays off and replaces the old mortgage is also generally taxable on the new obligation. The fact that the property was already mortgaged does not itself prevent a second round of mortgage tax.
CEMA means Consolidation, Extension, and Modification Agreement. In a properly structured transaction, the existing mortgage is assigned or continued, the new mortgage is consolidated with it, and tax is generally imposed on new money rather than on the portion of debt already taxed. That is the source of the potential saving.
The saving is conditional. The old mortgage must be identified, the required mortgage taxes must have been paid, and the prior lien generally must remain recorded until the supplemental instrument is recorded. If the old mortgage was discharged first, a later replacement may be treated as a new taxable mortgage even if it secures the same debt.
A purchase CEMA may be possible when a condo seller has an assignable mortgage and the seller’s lender, buyer’s lender, and attorneys coordinate. It is not automatic. The seller’s remaining balance, prior taxes, assignments, lender policy, title history, timing, and CEMA fees all affect whether the structure works. A CEMA is usually evaluated by comparing the tax on the new money with the tax on the proposed replacement mortgage, then subtracting lender, attorney, title, recording, and processing costs. The nominal tax difference is not the net saving. Delays and a lender’s refusal to participate can also outweigh the benefit.
A co-op share-loan refinance generally lacks this apartment-level MRT saving because the share loan is not secured by a recorded real-property mortgage.
Checked Mortgage-Tax Examples
These examples assume an individual Manhattan condo mortgage with the lender paying the 0.25% special tax, no CEMA, no first-sale condo credit, no exemption, and no special apportionment. The borrower budget uses 1.8% below $500,000 and 1.925% at or above $500,000. The combined total includes the 0.25% special additional tax.
For a $420,000 mortgage, 1.8% is $7,560 to the buyer under the stated lender-share assumption. The 0.25% component is $1,050, making the combined tax $8,610.
At exactly $500,000, 1.925% is $9,625 to the buyer under that assumption. Add the $1,250 special component for a $10,875 combined tax. An $800,000 mortgage produces $15,400 at 1.925%; the 0.25% component is $2,000 and the combined tax is $17,400. A $1.2 million mortgage produces $23,100 plus $3,000, or $26,100 combined.
At exactly $500,000, the conditional borrower-budget calculation is $9,625, not $9,000. A closing statement can differ by rounding or a transaction-specific adjustment, but not because the threshold is optional.
For a $600,000 condo purchase financed with a $420,000 mortgage, the buyer-budget MRT is $7,560, not $10,800. The purchase price matters for transfer taxes and other costs, while the mortgage amount controls the mortgage recording tax.
For a $1.5 million condo financed with an $800,000 mortgage, the buyer pays $15,400 under the stated lender-share assumption. Combined tax is $17,400, including the $2,000 special component. Mansion tax and transfer taxes are separate calculations based on the conveyance, not this mortgage amount.
Transfer Taxes Are Different
Mortgage recording tax follows the mortgage and is paid when the mortgage is recorded. Real property transfer tax follows the conveyance and is generally filed with the deed or transfer documents. The two taxes can appear in the same closing package, but they use different bases, thresholds, forms, and default payors.
NYC’s residential RPTT schedule is 1% at or below $500,000 and 1.425% above $500,000 for a one- to three-family house, individual residential condo, or individual co-op apartment. Other transfers use the higher NYC schedule. The NYC RPTT page also covers transfers of co-op shares.
New York State’s base transfer tax is generally 0.4% of consideration above $500, and the buyer-paid mansion tax begins at $1 million for residential property. NYC conveyances can also trigger state additional-base and supplemental taxes beginning at $3 million and $2 million thresholds, respectively.
The default payor rules differ. The state base and additional-base transfer taxes are generally seller obligations, while the mansion and supplemental taxes are generally buyer obligations. A contract, especially a new-development offering plan, may shift seller charges to the buyer. That contractual shift does not turn transfer tax into mortgage recording tax.
Buyer Strategy
Start with the loan amount, not the apartment price. Ask the lender for a written mortgage amount at application, then model both sides of the $500,000 threshold. A slightly lower loan can sometimes reduce the tax rate, but it may change cash reserves, interest expense, or underwriting, so tax savings alone should not drive the financing decision.
Ask for two separate lines in the estimate: buyer-paid mortgage recording tax and the statutory special additional tax. If a worksheet says 1.8% or 1.925%, confirm whether the lender component is excluded by allocation or shown elsewhere. Use the official ACRIS workflow for the final amount.
If the seller mentions a CEMA, request the existing mortgage recording information early. Have counsel confirm the original tax paid, unpaid principal, assignment path, lender consent, discharge timing, fees, and expected new-money base. Do not treat a verbal statement that the seller has a mortgage as proof that a CEMA is available.
For a co-op and condo comparison, calculate all-in cash to close. A co-op may avoid apartment-level MRT, but it can have mansion tax, transfer tax, legal fees, board and managing-agent charges, and lender fees on the share loan. A condo may add MRT and title costs but offer different financing and resale characteristics.
At contract review, separate purchase price, mortgage amount, mortgage tax, transfer tax, mansion tax, title charges, lender fees, recording fees, and building charges. New development buyers should read the offering plan and contract for shifted seller taxes and sponsor charges. Resale buyers should confirm which taxes the contract assigns.
For a Manhattan mortgage-tax review or another NYC buying plan, use TheNewYorkCityBroker.com/contact-me.
Frequently Asked Questions
Both figures can be correct for the borrower-paid planning amount. A mortgage below $500,000 is ordinarily 1.8%. A mortgage of $500,000 or more is ordinarily 1.925%. These figures include the 0.5% state basic tax, the 0.3% MCTD additional tax, and the NYC tax of 1% or 1.125%.
The complete statutory total is 2.05% or 2.175% after adding the 0.25% special additional tax. The 0.25% lender allocation follows the statutory property and mortgagee requirements; NYS applied it in a condominium advisory opinion, but unusual facts need closing-counsel review. Always confirm the allocation on the closing statement.
The phrase borrower-paid is a budgeting shorthand, not a separate tax created by a different statute. It is especially important when comparing lender estimates.
Yes. The NYC rate schedule uses the principal mortgage amount, and $500,000 or more enters the higher category. It is not a graduated tax where only the dollars above $500,000 receive the higher rate.
Thus, a $499,900 mortgage is ordinarily modeled at 1.8%, while a $500,000 mortgage is modeled at 1.925% for the borrower-paid components. The official calculation can also apply rounding and transaction-specific adjustments. Do not use the apartment’s sale price as a proxy for this threshold. Ask for the secured principal amount.
Usually not on the individual apartment share loan. A co-op buyer receives shares and a proprietary lease, rather than a deeded apartment interest secured by an individual real-property mortgage. NYC’s official MRT report states that mortgages on individual cooperative apartments do not incur MRT liability.
Co-op buyers can still owe transfer taxes, mansion tax, attorney and lender charges, application fees, move-in charges, and building-specific fees. An underlying building mortgage is a separate matter and does not convert a share loan into a standard apartment mortgage. Review the building’s financial package separately. Building debt does not equal apartment debt.
No. A refinance that replaces an existing condo mortgage is generally taxable on the new secured obligation. A CEMA or another qualifying supplemental-mortgage structure may reduce the taxable base to new money, but the exemption depends on the documents and timing. Under a qualifying supplemental-mortgage structure, the prior mortgage generally must remain recorded until the supplemental instrument is recorded, and the taxes on the prior mortgage must have been paid. If the prior mortgage was discharged first, a replacement agreement can be treated as a new taxable mortgage. A CEMA label cannot cure defective timing. Counsel must review the recording sequence.
Under the standard assumptions, the borrower-budget amount is $15,400, calculated as $800,000 multiplied by 1.925%. The 0.25% special additional tax is $2,000. The statutory total is therefore $17,400. This example assumes an individual residential condo, no exemption, no CEMA, no apportionment, and the usual institutional residential mortgagee allocation. The closing figure comes from current official calculation and the actual allocation. Worksheets may use different labels.
No. Mortgage recording tax is imposed on recording a mortgage and is based on the debt secured. Transfer tax is imposed on a sale or other conveyance and is based on consideration or value. They can be due in the same transaction but are separate taxes. For example, the mortgage on a financed condo may create MRT based on the loan, while NYC and state transfer taxes, mansion tax, and any NYC supplemental taxes are analyzed from the purchase consideration. The contract can also shift some transfer-tax obligations.
A closing statement should identify each tax by name. That makes review easier for the buyer and attorney.
