IRS tax lien loan for Refi

[Travis Tannahill]

I'm a mortgage broker and have a client who is in a little bit of a rough situation. 

Client lost a business in 2012. He owes about $80,000 in IRS back taxes. That number has grown to $160,000 over the years from penalties/interest but he has been advised that he can settle with the IRS for the original $80,000.

He owns a $500,000 house in Kansas City as his Primary. Owes about $200,000. Bank is sitting in 1st, IRS is sitting in 2nd.
He's tried to pull money out of this house but obviously can't because of the IRS tax lien no bank will sit in 3rd.
He's searching for a hard money lender to loan the $80,000 so he can pay off the tax lien, have the IRS lien removed, then re-fi his house to payback the hard money lender.

We're just thinking outside the box here he's been paying $2,000 a month since 2012 and just can't get out from under this.
Owns his own business, 150k-250k/yr, no collateral on the business side unfortunately. 

Let me know if anyone has any ideas on ways to help this guy out... he's very frustrated to have $300,000 in equity that he can't tap into.