tax liens

A “Release of Lien” should be recorded after a lien is paid off. And a “Reconveyance” should be recorded when a Deed of Trust is paid off. ? Loans (deeds of trusts, mortgages) typically attach to particular property, where involuntary liens like judgements or tax liens attach to the individual and impact all property held by that person.

Sounds like it is junior. Also very unlikely the IRS will redeem. I actually spoke to the head of the unti that handles this at the IRS and she confessed at the time their total budget for redeeming properties nationwide was $1M, she further said they really only redeem if a thrid party contacts them and expresses interest in the property. That may have changed since then. ? The mechanics lien is a bit tricky, my guess is no, but the real question is “will the title company insure the property when I try to resell it with that lien still there”. For that I’d recommend talking to the title officer at your title insurance co. ? Everyone please remember that I’m just an investor. I’m not an attorney, I’m not a title officer. This is what I’ve found from my experience, but laws vary by state, and things change over time, so please do your own diligence.

Sean,
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The title insurance company wants to do the insurance only if you resell the trustee sale property or you can still get the insurance if you keep the property?? Thanks.

Typically only if you resell or refinance.

Question:? Does the IRS and the state franchise tax board have 120 days to redeem a property sold at auction or just the IRS?
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Thanks!

Just the IRS.

What effect does the foreclosure have on title other than making sure title is clear for the transfer of the property? ? ??? Thank you, ? ??? I’m new to this game

When you buy a foreclosure it is subject to existing liens and encumbrances. Meaning, for example, that if you buy a 2nd mortgage at auction you will still owe the first.

If a house goes into foreclosure,with a 100K loan and when it sells the house goes for 50k does the senior man that had the foreclosure have to pay the IRS tax on the difference ?

Hi Polly, There are potential tax consequences on any debt forgiveness. There are variables like the occupancy status of the borrower and whether or not the homeowner is insolvent. You would want to seek the advice of a licensed tax practitioner in your state to determine what the tax liability would be.

How about purchasing property through county tax sale and it has irs lien? Is the IRS lien junior or senior to the county tax sale?
There is a property up for sale by Los Angeles county for unpaid property tax but it has IRS lien? what is usually happen to IRS lien?

IRS Liens are always junior to the property tax lien and are, therefore, wiped out by the tax sale. Except that when a property on which the IRS holds a tax lien is sold at public auction, the United States has the right of redemption for 120 days from the date of such sale or for the period allowable for redemption under local law, whichever is longer (26 U.S.C. §7425(d); §3712(g)). If they do redeem you will get your purchase amount back.

As a practical matter the IRS rarely redeems, but if there is a IRS tax lien it is generally a good idea not to make any additional investments into repairs, etc until after the redemption period is over.