Ramifications of IRS lien

Posted by Ward-CA- on October 27, 2002 at 01:31:50:

In Reply to: IRS lien posted by kylie on October 25, 2002 at 18:06:39:

: Another problem has come up with the house we are purchasing in CA. The house has an IRS tax lien and we know the people are in financial trouble. Does this lien need to be cleared before escrow can complete??? Or can the sellers pay off the IRS from their house equity, during the escrow completion process?? I suspect it will be very dificult for them to borrow money to pay the IRS at this stage.

: Thanks

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Kylie,

Unless you change your escrow instructions allowing the IRS lien to remain of record, the lien would have to be cleared off of title.

Yes, if the sellers’ equity is large enough they can instruct escrow to pay their IRS lien off out of their equity.

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Comments:
: : Another problem has come up with the house we are purchasing in CA. The house has an IRS tax lien and we know the people are in financial trouble. Does this lien need to be cleared before escrow can complete??? Or can the sellers pay off the IRS from their house equity, during the escrow completion process?? I suspect it will be very dificult for them to borrow money to pay the IRS at this stage.

: : Thanks

: =•=•=•=•=•=•=•=•=•=•=•=

: Kylie,

: Unless you change your escrow instructions allowing the IRS lien to remain of record, the lien would have to be cleared off of title.

: Yes, if the sellers’ equity is large enough they can instruct escrow to pay their IRS lien off out of their equity.


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