This being my first blog entry, I figured to talk about something simple.
In my law practice we see a lot of short sales. Indeed, we offer a service to Realtors and Sellers to process their short sale material with the lenders (without the downward pressure and lowball influence from an investor handling the process). I have worked statewide with lenders - visting their loss mitigation departments and sitting in on committee meetings. Knowing the process is key knowledge to improving the percent of short sale lender approval.
Now that you have the approval, what other bug will kill the deal. There are plenty still to come. Today we will address a likely culprit - an IRS lien for unpaid taxes.
The IRS lien can only be avoided if the lien was filed after the mortgage was recorded or if the mortgage money (all of it) was used to purchase the property (a "purchase money mortgage"). And the avoidance only takes place in a foreclosure.
If you are doing a short sale, you are looking straight in the eye of the IRS. The solution is that you are doing a short sale because of no equity and the homeowner is selling without getting any cash. There are procedures to get a release of the lien of the IRS from the house (not a satisfaction of the lien - just a release). The procedure is to contact the local IRS regional office and be prepared to offer up the same information as to the banks - and if you already have a bank short sale authorization that will be a plus.
The problem is that the IRS can take a month or longer to process the request. Hint - WALK the request into the regional office, wait an hour or so and then walk out with the lien waiver. Easier said than done. Fortunately for my practice, we have the regional office across the street and a lawyer in my office is a tax attorney and works with the people over there regularly. It's a pain (and I hate paying the extra freight) but getting the lien release is another step in the short sale process.
Any of you have any experiences you want to post?
Copyright 2007 Richard P. Zaretsky, Esq.
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Be sure to contact your own attorney for your state laws, and always consult your own attorney on any legal decision you need to make. This article is for information purposes and is not specific advice to any one reader.
Richard Zaretsky, Esq., RICHARD P. ZARETSKY P.A. ATTORNEYS AT LAW, 1655 PALM BEACH LAKES BLVD, SUITE 900, WEST PALM BEACH, FLORIDA 33401, PHONE 561 689 6660 email: RPZ99@Florida-Counsel.com - FLORIDA BAR BOARD CERTIFIED IN REAL ESTATE LAW - We assist Brokers and Sellers with Short Sales and Modifications and Consult with Brokers and Sellers Nationwide! Shortsales@Florida-Counsel.com New Website www.Florida-Counsel.com.
See our easy to understand articles at:
TABLE OF CONTENTS - SHORT SALE AND LOAN MODIFICATION ARTICLES
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