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Old 08-23-2013, 03:04 PM
 
1 posts, read 1,854 times
Reputation: 10

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Hi folks - just looking for whatever good advice/ideas people feel like serving up on my unfortuate situation:

Started the process on purchasing my neightbor's house back in June. Got a rate lock for 60 days 3.5% 30 year fixed. Rate lock ends on Monday.

The seller was unable to provide certificate of occupancy for extensive renovations he did a couple years back. Turns out he pulled permits but never had inspections done. Took a month to clear that up. We closed, or so we thought, Tuesday Aug 13. Signed all the papers, paid the money and got the keys. A couple hours later, we're in our new house, my phone rings, and it's my bank's attorney. He's at the courthouse with the seller's attorney. When they went to file the deed/title they found a $58,000 tax lien against the seller! He tells me to get out of the house and give the keys back.

The seller squared up with the IRS more than a year ago, but apparently they never removed the lien (how he could run his affairs so sloppily!). The tax attorney he used for his IRS problem has gotten involved, but had no success getting a letter from the IRS that the lien is to be cleared.

What kind of recourse do I have here if I lose my good rate? I guess the tax issue will be resolved eventually, but not by Monday.

Who should I be the most mad at - the seller? Or the person who did my title search/insurance. Shouldn't they have found this?

Thanks in advance for any input!
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Old 08-23-2013, 03:06 PM
 
Location: northern va
1,533 posts, read 1,899,090 times
Reputation: 1303
Quote:
Originally Posted by perkunas View Post
Hi folks - just looking for whatever good advice/ideas people feel like serving up on my unfortuate situation:

Started the process on purchasing my neightbor's house back in June. Got a rate lock for 60 days 3.5% 30 year fixed. Rate lock ends on Monday.

The seller was unable to provide certificate of occupancy for extensive renovations he did a couple years back. Turns out he pulled permits but never had inspections done. Took a month to clear that up. We closed, or so we thought, Tuesday Aug 13. Signed all the papers, paid the money and got the keys. A couple hours later, we're in our new house, my phone rings, and it's my bank's attorney. He's at the courthouse with the seller's attorney. When they went to file the deed/title they found a $58,000 tax lien against the seller! He tells me to get out of the house and give the keys back.

The seller squared up with the IRS more than a year ago, but apparently they never removed the lien (how he could run his affairs so sloppily!). The tax attorney he used for his IRS problem has gotten involved, but had no success getting a letter from the IRS that the lien is to be cleared.

What kind of recourse do I have here if I lose my good rate? I guess the tax issue will be resolved eventually, but not by Monday.

Who should I be the most mad at - the seller? Or the person who did my title search/insurance. Shouldn't they have found this?

Thanks in advance for any input!
them
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Old 08-23-2013, 04:24 PM
 
Location: Mokelumne Hill, CA & El Pescadero, BCS MX.
6,955 posts, read 18,117,961 times
Reputation: 6342
I wouldn't move out. I wouldn't give the keys back. The glitch will likely cure itself, but not in a timely manner. having said that, it can be fairly easy to get the IRS field office person to remove a lien presented with the facts.

In most states it can take a while for the process of eviction to run it's course and you certainly have reasonable reason to be there, I wouldn't worry about the Sheriff showing up to put you on the street.

Good Luck!
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Old 08-23-2013, 05:41 PM
 
Location: OK
2,692 posts, read 6,162,421 times
Reputation: 1819
I wouldnt move out but tell the attorneys to go talk to the title co.
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Old 08-24-2013, 08:28 AM
 
Location: MID ATLANTIC
7,434 posts, read 16,997,136 times
Reputation: 7762
Uh, did you take out title insurance? The lender required it, so I fail to see why they are booting you out.
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Old 08-24-2013, 01:25 PM
 
Location: Scottsdale, AZ
1,970 posts, read 3,659,590 times
Reputation: 2819
IRS tax liens are different than all other liens. The IRS can take back the property (I think for up to 90 days, but don't quote me) regardless of what has transpired with the sale.

But more importantly, since a new deed has not been recorded you do not own the house. As for moving out or staying, it's your choice, but you are a squatter at this point. You did not make any mention of your attorney (I know just what you need another attorney mucking up the water), but you should have your own representation to make sure you don't get the short end of the stick. None of the other 3 attorneys are going to protect your interest.
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Old 08-30-2013, 04:03 PM
 
1 posts, read 1,462 times
Reputation: 10
I have a home in escrow 2 weeks away from closing. During the 90-day escrow we found out the ducting for the AC is on the roof exposed to the elements, the 2 back rooms aren't ducted. There has been a flood in the front yard due to a broken sprinkler system. The outlets in the kitchen are not grounded. There is possible leak in the garage roof. The water heater broke and flooded the laudry room, but the seller pulled up the floor in there and put in a new water heater. We just found out there is rot on one of the overhangs in the roof. We want to back out of the deal, but the agent is saying we will get sued because we are so far into the deal--almost 90 days. Will we have problems if we back out now, or will we have more trouble if we don't with paying for future repairs?
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Old 08-30-2013, 04:13 PM
 
Location: Mokelumne Hill, CA & El Pescadero, BCS MX.
6,955 posts, read 18,117,961 times
Reputation: 6342
Quote:
Originally Posted by emotionallydistraught View Post
I have a home in escrow 2 weeks away from closing. During the 90-day escrow we found out the ducting for the AC is on the roof exposed to the elements, the 2 back rooms aren't ducted. There has been a flood in the front yard due to a broken sprinkler system. The outlets in the kitchen are not grounded. There is possible leak in the garage roof. The water heater broke and flooded the laudry room, but the seller pulled up the floor in there and put in a new water heater. We just found out there is rot on one of the overhangs in the roof. We want to back out of the deal, but the agent is saying we will get sued because we are so far into the deal--almost 90 days. Will we have problems if we back out now, or will we have more trouble if we don't with paying for future repairs?
I'm guessing most states allow for an inspection period (CA does) that is within a couple of weeks of acceptance of the offer. If you have run past the inspection period, I would tend to agree with the advice your agent gave you with the caveat that you might lose your deposit, but getting sued for specific performance is unlikely.

Now if your lender requires repair of the items you cite, in order to make the loan, you may have an out for your loan contingency.

This is based on CA law, but may not apply in your area.
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Old 08-30-2013, 04:46 PM
 
6,318 posts, read 6,923,483 times
Reputation: 10694
Quote:
Originally Posted by AZJoeD View Post
But more importantly, since a new deed has not been recorded you do not own the house.
This, of course, varies by state. In Michigan, property transfers when a deed is conveyed--not when it is recorded.

This thread is a week old so I'd be curious as to what the OP has been doing.
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Old 08-30-2013, 07:40 PM
 
Location: MID ATLANTIC
7,434 posts, read 16,997,136 times
Reputation: 7762
Quote:
Originally Posted by DMenscha View Post
I'm guessing most states allow for an inspection period (CA does) that is within a couple of weeks of acceptance of the offer. If you have run past the inspection period, I would tend to agree with the advice your agent gave you with the caveat that you might lose your deposit, but getting sued for specific performance is unlikely.

Now if your lender requires repair of the items you cite, in order to make the loan, you may have an out for your loan contingency.

This is based on CA law, but may not apply in your area.
I agree, what DMenscha said - has your financing contingency been removed? You can try a Hail Mary and see if your loan officer can find a legitimate reason to decline your loan.
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