Forclosure Acution, with IRS lien. Advise requested.

[Wilson Lee]

I plan to bid on a number of house at my local foreclosure auction.  I have done some title searching at my local court house for any title issues for properties that are on my short list.  One potential property has a income tax lien recorded after the original mortgage. I would welcome any advice and correction to my understanding, here is what I think I know.

1) the tax lien is subordinate to the mortgage given the dates of recording.

2) I do not have to play the tax lien at the time of purchase do to it's subordinate status.

3) The IRS has 120 days in which they can purchase the property to back form me for the amount I paid plus my cost to secure the property. But not any improvements I would have made.

4) The IRS budget is relatively low for this buy back program, Late in the year it is typicality consumed or re-purposed. 

Also, I would like to know how the lien would effect future delayed financing or an equity loan.

Can anyone with experience please comment.

P.S I will not be paying for a title company. Doing so on each property that may or may not be available at auction is not financially feasible.  Especially if I don't win the bid.

[Jay Hinrichs]

rare that you would get a lender to give you a loan without title insurance removing the IRS lien.

so for practical purposes NO you won't get a loan.. you might find a private person to do it.

I have done them over the years but charge a hefty premium for them. so usually better to wait until the 120 is over and or rehab with cash.