NYC CEMA Mortgage Calculator (2026): How to Slash the 1.925% Mortgage Recording Tax on Refinances & Purchases
Refinancing or buying a NYC condo, townhouse, or Westchester home? Use our 2026 CEMA Mortgage Calculator to model exact NY Tax Law § 255 savings on the 1.80%–1.925% Mortgage Recording Tax.
By Pablo Cirre Gómez and East Corp Capital Quantitative Desk
NEW YORK — In almost every American city, refinancing a mortgage when interest rates drop is a straightforward math problem—but in New York City, the 1.925% Mortgage Recording Tax (MRT) can devour two years of monthly payment savings on day one unless you use a uniquely New York legal instrument. How much money does a CEMA loan (Consolidation, Extension, and Modification Agreement) actually save you on a NYC condo or townhouse refinance or purchase in 2026? On a $1,200,000 NYC condo refinance where $880,000 of existing unpaid principal is assigned via CEMA under NY Tax Law § 255, your Mortgage Recording Tax drops from $23,100 down to $6,160—handing you $14,690 in net cash savings even after paying a $2,250 bank assignment fee.
NYC CEMA Mortgage Recording Tax Savings Calculator
Calculates exact Mortgage Recording Tax (1.80%–1.925%) saved by consolidating an existing unpaid mortgage balance into a new refinance or purchase CEMA loan in NYC, Westchester, or Nassau.
How Does a CEMA Mortgage Work Under New York Tax Law § 255?
In forty-three US states, refinancing a residential mortgage simply means paying off your old note, recording a satisfaction of mortgage, and registering a new deed of trust with minimal county recording stamps. In New York City, Westchester, and Nassau/Suffolk, however, recording a brand-new mortgage triggers one of the steepest closing levies in America: the New York Mortgage Recording Tax (MRT).
Inside the five boroughs of New York City, the total MRT on a 1–3 family home or residential condominium is 2.05% for loans under $500,000 (of which the borrower pays 1.80% and the lender pays 0.25%) and 2.175% for loans of $500,000 or more (of which the borrower pays 1.925% after a $30 deduction). On a $1,200,000 refinance, tearing up your old mortgage and recording a new one costs $23,070 in tax alone—often wiping out two full years of interest-rate savings.
Enter the Consolidation, Extension, and Modification Agreement (CEMA) authorized by New York Tax Law § 255. Instead of satisfying and extinguishing your existing mortgage, your current lender signs a Section 255 Assignment of Mortgage transferring the unpaid principal lien to your new lender. If you need extra funds (a ‘gap mortgage’ for renovations, cash-out, or a higher purchase loan), the new lender records a small new mortgage for the difference and consolidates both liens into a single updated note. Under § 255, NYC and New York State can only levy the 1.925% Mortgage Recording Tax on the new money gap.
| New Mortgage Amount | Existing Unpaid Principal Assigned | Taxable 'New Money' Gap | Standard NYC MRT (No CEMA) | CEMA MRT Due at Closing | Est. Bank CEMA Legal/Assign Fee | Net Borrower Cash Saved |
|---|---|---|---|---|---|---|
| $650,000 | $520,000 | $130,000 | $12,513 | $2,503 | $2,000 | $8,010 |
| $900,000 | $750,000 | $150,000 | $17,325 | $2,888 | $2,250 | $12,187 |
| $1,200,000 | $880,000 | $320,000 | $23,100 | $6,160 | $2,250 | $14,690 |
| $1,600,000 | $1,250,000 | $350,000 | $30,800 | $6,738 | $2,500 | $21,562 |
| $2,500,000 | $2,000,000 | $500,000 | $48,125 | $9,625 | $2,750 | $35,750 |
Let’s Run the Numbers in Dollars: Marcus Refinancing His $1,500,000 Williamsburg Condo with $1,100,000 Existing Principal
Let’s look at the exact closing table numbers for Marcus, who owns a condominium in Williamsburg, Brooklyn with an existing $1,100,000 mortgage balance at 7.125% and refinances into a new $1,150,000 loan (rolling in $50,000 for renovations) at 5.875%:
- Without a CEMA (Standard Refinance): The old $1.1M mortgage is satisfied and extinguished, and NYC taxes the entire new $1,150,000 mortgage at 1.925% = $22,138 in Mortgage Recording Tax.
- With a Section 255 CEMA: Marcus’s existing lender assigns the $1,100,000 unpaid note to the new bank, and a $50,000 gap mortgage is consolidated. NYC only taxes the $50,000 of ‘new money’ at 1.925% = $963 in tax. After paying $2,400 in CEMA assignment and legal fees, Marcus saves $18,775 in hard closing cash.
What Is a 'Purchase CEMA' (Splitter Agreement) When Buying a NYC Condo or New Development?
CEMAs are not limited to homeowners refinancing an existing loan. When you buy a resale condo or townhouse in Manhattan or Brooklyn, the seller often has an existing mortgage (or a developer has a construction loan on a new condo building). In a Purchase CEMA, the seller’s bank assigns their unpaid mortgage balance (say, $800,000) to your buyer’s lender at closing, and your lender adds a $200,000 gap mortgage to reach your $1,000,000 financing target.
Because the seller also saves 0.40% to 0.65% in New York State Transfer Tax under the Continuing Lien Deduction (NYS Tax Law § 1402) when an existing mortgage remains on the property, NYC buyers and sellers routinely negotiate a 50/50 split of the combined CEMA savings—putting $7,000 to $15,000 back into both parties’ pockets.
Why Do Some Lenders Refuse to Assign a CEMA—and How Long Does Processing Take?
There is one important catch: under New York law, your existing lender is not legally required to grant a CEMA assignment to a competing bank. While major portfolio lenders operating in the Tri-State market (Chase, Citibank, Wells Fargo, Bank of America, TD Bank, Citizens) routinely process CEMA assignments for an administrative fee of $1,000 to $2,500 plus $750–$1,200 for bank counsel, the collateral department must locate the original wet-ink promissory note and chain of recorded assignments—which typically adds 30 to 60 days to your refinancing timeline.
Compare full buyer closing costs in our NYC Mansion Tax & Closing Cost Calculator, see why co-op share loans never pay recording tax in our NYC Co-op vs. Condo Calculator & Guide, and model your monthly payment in our East Coast Mortgage PITI Calculator.
Frequently Asked Questions
Do I need a CEMA when refinancing a NYC co-op apartment?
No. Co-op apartments are legally personal property (shares in a cooperative housing corporation paired with a proprietary lease) rather than real property. Consequently, co-op mortgages (share loans secured by a UCC-1 financing statement) are 100% exempt from the 1.80%–1.925% NYC Mortgage Recording Tax, making a CEMA unnecessary.
What is the minimum loan balance where a NYC CEMA makes financial sense?
Because the assigning bank charges $1,000–$2,000 and title/closing attorneys charge an extra $850–$1,500 to draft the Section 255 affidavit and gap consolidation documents (roughly $2,250–$3,200 in total CEMA fees), a NYC condo or house refinance needs at least $175,000 to $200,000 of existing unpaid principal for the 1.80%–1.925% tax savings to exceed the legal and assignment fees.
Does a CEMA work in Westchester, Nassau, or Suffolk County?
Yes. Section 255 CEMAs are valid statewide across New York. While the MRT rate outside the five boroughs is lower than NYC's 1.925%—typically 1.05% in Westchester and Rockland counties and 0.80% in Nassau and Suffolk counties (after the lender's 0.25% share)—a CEMA on a $1,000,000 Westchester jumbo refinance still saves $10,500 in gross tax.