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refinancing fha loan........have a 20k outstanding balance to IRS in which we are making monthly payments on.......do we have to pay it off with the proceeds of the refinance......Is this some kind of FHA rule.....
As long as you are making payments, this would have to be subordinated (ask your mortgage broker). If you were not making payments, that would be part of the process.
we have made one payment and on time........but the mortgage guy said that we have to pay the IRS because we don't have a 12 month history of payments.......It also doesn't shop up on or credit report as a negative.......
If it doesn't show up on credit and it is not payroll deducted there is only 1 other way I can think of that they could have found it- during the title search. This means the IRS is in first lien position. You can not get an FHA loan in 2nd lien position that I have ever heard of. Even if you get the IRS to subordinate you still have to count it against TLTV or Total Loan To Value-Total of all liens on a property. If your loan is $100k $20k is significant in this calculation. If you loan is $250k not nearly as significant. There are guidelines which govern the maximum allowable percentages.
we have made one payment and on time........but the mortgage guy said that we have to pay the IRS because we don't have a 12 month history of payments.......It also doesn't shop up on or credit report as a negative.......
One payment isn't enough. You need a 12-month history of on time payments to the IRS to be considered for FHA financing.
If it doesn't show up on credit and it is not payroll deducted there is only 1 other way I can think of that they could have found it- during the title search.
It will show when the 4506T is processed. "Outstanding balance" will be there clear as day. There's no hiding it. It should be paid. I have yet to see IRS ever agree to put themselves in second lien position (in writing), although I have run across those that have claim to done it. (but these are not people that I know, only online personalities or other lenders that want the loan, maybe, someone that plans to hide the information).
It will show when the 4506T is processed. "Outstanding balance" will be there clear as day. There's no hiding it. It should be paid. I have yet to see IRS ever agree to put themselves in second lien position (in writing), although I have run across those that have claim to done it. (but these are not people that I know, only online personalities or other lenders that want the loan, maybe, someone that plans to hide the information).
Very good to know- fortunately I have never had a client in this position before.
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IRS would subordinate this
what do u mean by subordinated......
