IRS Tax Lien Question
To whom it may concern,
My wife and I were trying to get a mortgage loan for a home. I spoke with a Loan officer today and today and unfortunately, I have a tax Lien for around 7k. He told me that it would be hard for me to get any type of loan until the tax lien is lifted. I see that there are many law firms and groups that offer a service to lift the tax lien and put you on a payment plan. I am a little skeptical of that process, but I would like to see if I can get this lien lifted in order to pursue buying a home. Is there any groups or techniques that you would suggest looking into to lift this lien? Thanks for your assistance
I'm going to suggest a different approach:
1) See if your wfie can qualify for a mortgage without you. This way you can buy the property and then she can add you to the title easliy.
2) If you have sufficient resources (i.e. access to funds) attend a RE auction and see if you can acquire a property that way.
3) Contact the taxing agency directly and see if you can work out a payment plan. It will likely not remove the tax lien quickly, but at least you will be working towards a future prospect.
Glenn
I suggest that you immediately pay off the tax lien before it's too late and you lose the property completely! There is no way to get out of the tax lien on the property, so don't waste your time. The investor of the tax lien is not going to make it any easier for you to get out. And it will remain on the property until it either gets paid off, or they take over the property from you. Good luck! And don't take your time!
Richard
It will be very difficult to get a home loan until you payoff the 7k with the IRS. They figure if you have
7k to buy a house, you have 7k that belongs to them. You might check your down payment and see if you can get the seller to pay closing costs and offset some of that by offering him full price for the house. If your wife has good credit, THAT WON'T WORK EITHER. The title company passing and guaranteeing a "clean" title has to insure the "Quit-Claim" deed from yourself to your wife, they can't do that without clearing the tax lien first. THE IRS LIEN WILL COME FIRST BEFORE A LENDER IN THIS CASE.
"I see that there are many law firms and groups that offer a service to lift the tax lien and put you on a payment plan. I am a little skeptical of that process, "
Glad to see you're skeptical of that plan, as I've known lots of people who tried that route, but NEVER knew one to work, any lien to be lessened or lifted, etc...it just isn't going to happen.
An Offer in Compromise takes months or years to work through, and even then, it rarely is much of any reduction in taxes owed or claimed by IRS.
If your refi would be enough to pay off the IRS lien, but it can't work until it's paid, then I'd advise you to go get private loan to pay IRS, then immediately refi, pay back the pvt lender with the refi proceeds.
I'm looking for some clarification to your question.
As I understand it you and your wife are trying to BUY a home, not Re-finance a home. If that is correct then I go back to my original suggestions:
1) First and foremost to get on the road to restoring your credit you will have to re-pay the lien. If you don't do this now, you will have to do it later whenever you want to get credit in your name. The penalties and interest are only going to get worse, and if your not careful they may garner your wages and bank accounts.
2) If your wife has good credit - and she can quality for a homeloan based on her income, she can buy the house in her name. Before you get added to the property you will want to have the tax lien paid off. There can be some creative finance techniques that can be used if warranted, but it would still be done in her name.
If I mis-understand what you are asking, then ignore this post.
Glenn
BJ8:
Try making an offer to buy from a motivated Seller?
Tell them you know that you can Qualify for $XXX,XXX.XX dollars and if they could make a 2nd mortgage out to you?
This may seem a little complicated but you'll need to work with a good Mortgage Broker.
The Mortgage Broker wouldlocate a lender willing to do your loan "knowing" that the IRS Lien will be paid off as a condition of closing.
Get the seller-concession to pay this lien 'on the buyer's behalf' directing the Title www.Co.to pay off the $ to the IRS.
The TRICK IS to have a competent Mtg-Brkr Put it together for you once you've located a willing Seller.
TheLoan from the Seller can be handled as follows:
A) A Forgiveable loan or
B) A 2nd lien could be made on the property or
C) Buy the home at full-mkt price with the seller agreeing to a concession of $7K on your behalf.
I hope this HELPED!
Derrick
Call me silly or other names, but I feel that if you owe IRS you should pay IRS.
Tax revenue is this country's life blood.
Work out a plan with them.
In the mean time start looking for seller financed homes.
I do not know what the problem is?
The IRS will grant you a payment plan on the taxes owed. That payment is part of your debts, just like a car loan. After you make a few payments, a bank will take this into account, figure the payment into the debt-to-income ratio and grant the loan on that basis.
You will not be getting an "A" credit loan and non-conforming banks do all sorts of interesting packaging of loans.
Good luck,
Mitchell Goldstien
Maybe you could find the house that you want to buy, tell the seller that you want to pay him full price plus seven grand, if he agrees to give you the seven grand up front to pay off the IRS. As long as the house can appraise for that price, which is likely if you tell the apraiser that the house is under contract for that price. Get the mortgage which will pay back the 7k, done deal. Let your loan officer know what you are doing. Could work, something to think about. Z
Having been in a situation with the IRS myself, I'll tell you that they are going to get paid, and that's that. My situation was that I sent in a return un-signed. (My mistake). It went directly to the circular file, and I was not notified. I moved, and the notice of the problem was sent to the address on my return long after the post office quit forwarding my mail. It seems that since I hadn't filed a return, they calculated my tax burden for me, and of course with no deductions, I ended up owing them money. Since I started working with them within three years of the date that the return was to have been filed, They allowed me to file an ammended return. As a result of this the garnishment of my wages stopped, and my lien went away. My suggestion would be to contact the IRS as soon as possible, and try to work something out with them. The longer this goes, the worse it gets. And stay away from calling them derrogatory names, no matter how frustrated you get with the system. It won't help your cause.
Good luck,
Jeff