Odds Are You CAN Buy A Home If You Have Tax Liens Or Delinquent Taxes, But You Must Grab The Bull By The Horns
Underwriting guidelines differ for home loan applicants who’ve undergone significant economic events. The good news is that you can still obtain financing with attractive rates and terms.
If you have tax liens or owe delinquent taxes, chances are you don’t have enough deductions. Your lack of deductions, at least in part, result from not owning a home. And of course you can’t qualify for a home because you have tax liens or delinquent taxes. It seems that neither the lenders nor the IRS will budge. Sounds familiar?
Over the past three decades we’ve encountered hundreds of would-be homeowners trapped in this morass, year in and year out. It’s maddening, but there is a path to homeownership.
We Can Help You.
Here’s the crux of the problem (this assumes the applicant has an IRS Tax Lien):
- A Tax Lien is a security interest given in a property to secure payment of a debt.
- A Tax Lien has priority over any other lien that’s recorded after the Tax Lien.
- The Tax Lien applies not only to property owned by the taxpayer at the time the Lien is placed, but to any property acquired by the taxpayer after the Lien is assessed.
- If the taxpayer wants a mortgage to buy a home, the lender expects their lien (deed of trust) to have priority over all other liens, whether existing or subsequently recorded. Otherwise the lender will not make the loan.
- If the taxpayer has a Tax Lien and buys a house, the lien extends (attaches) to the title of the house even though the home wasn’t owned when the lien arose.
- There is a direct conflict between Statement 4 and Statement 5 above because in Statement 4 the lender requires their lien to have priority, but in Statement 5, by operation of law, the IRS Tax Lien has priority.
Here’s the solution:
The only way the taxpayer can buy a home is to pay the delinquent taxes and have the Tax Lien Released, OR negotiate an agreement between the lender, taxing authority, and taxpayer that permits the taxpayer to buy a home, notwithstanding the Tax Lien.
We Can Help You.
To find out more about mortgage strategies for
those with tax difficulties, please contact us today.
Call 855.SLG.FUND (855.754.3863) or inquire below.
Square Peg? Round Hole?
We can help you.