I received the following question from a friend: Do you know if anyone will give me a home loan with money owed to the IRS. I've been working with a firm which is setting up a payment plan for me and it may take 3 or 4 years to pay...................but it's a payment plan they've agreed to .................... I could put down 20 % on a home and even if I could only get a higher interest payment it would be OK. There are no liens, and nothing on this persons credit report about this. They are concerned about having to bring tax records to the mortgage company. This person has a very good income. And several open tradelines with no lates. Not sure of credit scores. Maybe a couple negs from the past. Does anyone know the answer???
Our experience has been that getting a mortgage didn't require any tax records at all. Usually tax returns are used as one of the means of proving income, but check stubs and bank statements can prove income as well. If your friend has no liens that is the best news in the whole thing. As long as the installment agreement is kept up there shouldn't be any further action from the IRS and no one should have any way of knowing about the back taxes. Now, with that being said, I am speaking only from our personal experiences. There are some mortgage experts on the board who I'm sure could offer more conclusive info. DemPooches
OtherTerri As long as the money being owed to the IRS does not showup as a tax lien then, everything else being equal, your friend should not have any problems getting a mortgage. If in all other areas your friend's credit and scores are good, if the debt ratio is good then tell your friend to go for it. Hope tjis helps. fla-tan
I am currently paying back taxes via an installment agreement with the IRS. A tax lien has not been placed. My husband and I plan to buy a house when our current lease is up in Feb. 2003 and have wondered if the owing of the back taxes would result in us being denied a mortgage. We do plan to go for it. Thanks for posing the question and the positive responses received.
Thanks, Fla-Tan. I thought that was the case, but not sure. my2sentz -Good lUck with your future home
it could be a problem if you are considering FHA bcause you cannot have any outstanding federal obligatons like student loans or taxes
Diva Normally, as long as the obligation is not in collections, then FHA will usually not deny. fla-tan
Diva Normally, as long as the obligation is not in collections, then FHA will usually not deny. fla-tan
