Tax Lien On Property During a Wholesale Deal

Austin, TX · Member since 2016 · 24 posts · 4 votes

Good afternoon investors. Getting ready to Wholesale a property, but the seller owes $2K in taxes. The title company should subtract that money from the final transaction between the seller & the buyer I sell the contract to. Right? Just want to make sure nothing comes from my piece of the pie.

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Investor · Orlando, FL · Member since 2016 · 1k+ posts · 780 votes
9y
Yes that is true. But you need to close a few days before any tax lien auction to give the title company time to pay off the lien.
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Ned CareyPro Member
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Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
9y
Generally yes but contracts could be written is such a way that that might not be true. You'd have to really screw up for that to happen.
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Rick Pozos
Wholesaler, Rehabber and Landlord · San Antonio, TX · Member since 2014 · 2k+ posts · 2k+ votes
9y
The tax is responsibility of the seller. The seller pays it. It comes out of the money that he is getting.
So you are buying a property for 50k, you assign it for 5k. The buyer is paying 55k. The title co finds a lien for 2k. Well now the seller is getting 48k minus all the other closing costs. Yes, you still get your 5k and the buyer is still buying for 55k.
Good Luck!!!
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Marcus Maloney
Rental Property Investor · Queen Creek, AZ · Member since 2013 · 368 posts · 191 votes
9y
Yes the lien will be paid via title during the closing. That cost is applied to the seller
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