Our mortgage friend, Ron Hall, with BNC Mortgage has provided another good post for our readers here at Urban Life. Today's topic is the dreaded IRS Tax lien on a home. Much thanks to Ron for this info and be sure and contact him if you have any questions. He can be reached at 623-293-6970 or rhall@bncnationalbank.com
Many home buyers and real estate professionals find out they are dealing with a tax lien and assume that this buyer is done and move on to the next client.
I am here to tell you that is a HUGE mistake. In FHA lending the rule of thumb is that if the collection can affect title it has to be paid off, well that’s a guideline not a rule.
A couple of things come into play that most people are not aware of: First, is there a payment arrangement? In this case can you show that you have set up a payment plan with the IRS and have made those payments in a timely manner? The gold standard here is 12 months of canceled checks as proof. If the answer to that is yes the second and very little known tool is… Will the IRS subordinate the lien to the mortgage? We’ll most of the time that answer is YES. Think about it for a minute, you owe the tax guy some money, you want to buy a home, so you ask the IRS to subordinate the lien so that you can accumulate an asset that they can collect against in the future if you default. Is there really a downside for them?
Hope this information is helpful and we wish you a great and prosperous February as we reach the end of the first month of 2010.
Gene Urban
The Urban Team at Realty Executives
602-234-5777
This information is deemed reliable but not guaranteed.
