My mom passed away & left me her house. I owe Federal taxes, can I get a mortgage?
Can I get a mortgage and cash out and pay back taxes from proceeds? I am afraid to start estate proceedings until I can figure out what my options are.
Public Comments
- If you didn't file federal taxes for the last year or so, you may have a little tougher time of getting a mortgage. However, I am not aware of a reason for which owing income taxes would stop you from getting a home loan. Having no job, or a poorly paying job, or high revolving (credit card) debt, or not paying your non-tax bills would probably be a much bigger problem.
- you dont get a mortage if the house is paid for already and you own it you can get a home equity loan
- Almost anyone can get a home equity loan (once title is transferred to you). The question is, what will the interest rate be? Talk to banks in your area, and describe your situation accurately. It is not unusual to pay taxes with a home equity loan.
- Please ignore the answers here. They will only completely mess up any chance you have of resolving your tax problem. The FIRST thing you need to do is hire a competent tax professional. Lien law is VERY complex and precious few tax professionals have any idea what lien law entails. I've handled many cases similar to yours and they are complicated. Regardless of whether or not you have put the house into your name yet, the house is yours for all intents and purposes. If the IRS already has a tax lien filed in the county in which your Mom had her home, the lien attaches to that property as well. If there is no lien filed or if there is a lien and your Mom's property is in another county, so much the better. If there is enough equity in the home to pay off the taxes in full, it won't be much of a problem. If there isn't enough equity, you'll have to go through a process called Subordination of Federal Tax Lien. I have posted information on a similar process called Discharge of Federal Tax Lien. The major difference is a Discharge involves a sale of a home that won't result in paying off a lien in full while a Subordination involves refinancing a home that won't payoff a lien in full. Hope this helps.
