All Forum Posts by: Kao Saeteurn

@Wayne Brooks gotcha. Yes they were notified more than 60 days in advance. Thank you. I also talked to the title company and it sounds like they confirmed they will insure the title and disclose that there is a redemption period and after the 120 days insure the title with a clean bill.

@Tylor Billings I have not but I think my title closing company will. If not, I’ll have them talk to them. Gotcha, that’s what I’m leaning towards doing.

@Wayne Brooks thanks for your reply. Would you be concerned the lien will not be discharged for any reason? That’s my only concern really. I want to flip it since it’s pretty much move in ready but obviously we can’t close until the title is clean in December.

I forgot to mention that the title company said they will delete the requirement for the lien to be off the property to insure the title. After 120 days redemption period on December 19, they will insure the clear title. Hopefully this makes sense. The property is in Tucson, AZ btw.

I ended up being the high bidder on an auction.com property. Prior to bidding, I had a title company pull an investor search of the title and found that it was recently purchased for 290k by the bank at as a foreclosure at a trustee sale on Aug 21 and property taxes were all paid to be current. The auction.com auction ended on Sep 11. I ended up being the high bidder at 238k and the market value of it was 310k. After I submitted the earnest money, the title company found an IRS tax lien for 85k which was junior to the mortgage that foreclosed. The preliminary title report showed that it will sunset in 120 days (December 19). After researching many IRS manuals and BiggerPockets forums, the IRS lien should be discharged after a non judicial foreclosure and the IRS has 120 days to redeem the property (IRM 5.12.4.3). There many other requirements such as giving notice to the IRS 25 days prior to the foreclosure sale which all did happen by the foreclosing attorney. 

According to the purchase agreement, we are set to close on Oct 11. I consulted with an attorney and his "recommendation" is to not purchase it until the title company is able to give me a clean title. If we delay closing (with the permission of the seller) then we incur a $100/day fee ($7,900). Is there anyway we can avoid this fee? 

It is obvious I should not close until we can get the property free and clear, but say we ended up closing. Will the lien drop off as it would normally in a non-judicial foreclosure? If the lien does drop off and during the 120 day redemption period, the IRS decided to redeem, does the IRS redeem and pay me or the seller (the original foreclosure purchaser)? The attorney said the IRS will most likely redeem from the seller and I should have some stipulation stating the seller must pay me my purchase cost.

I know I should have done more due diligence, but that is beyond the point. I just want to know is there anything else I can do. Any help is appreciated. Thank you in advance! 
 

@Jesse Smith

Have you asked them or even told them how you feel especially when they talk to you about how an agent dropped the ball? Just step up and ask them why didn’t you use me? They’re your friends, you should be able to talk to them about these things.

@Ryan H. No there is not. There’s a website that states which counties in Arizona need it and Pima county is not one of them.

@Michael Leung yea I noticed the bidders were mainly two or three people. How do you know they see inside of the houses?

@Saxxon Rybski welcome to BP! I’m a new investor also and just purchased my first rental property I. April. Been looking ever since for the next one. I’m definitely willing to meet up with other investors.

@Ron Na I was in the same boat as you. My rental property does not have a mortgage on it and I got my HELOC thru PenFed. I got mine a couple months ago and it was an easy process. PenFed is geared for military members or veterans so I'm not sure what you'll need to do if you're not a military member or veteran. I think there's an application to do for it. Let me know if you have any other questions. Thanks.