Tax Lien Issues with FHA Mortgage Loans
Filed under FHA FAQ, FHA news · Tagged: FHA insured mortgage, FHA mortgage insurance, FHA mortgage lender, second mortgage
FYI- If the borrower is presently delinquent on any federal debt (IE VA-guaranteed mortgage. HUD insured FHA loan, federal student loan, Small Business Administration loan, delinquent federal taxes, etc) or has a lien, including taxes, placed against his or her property for a debt owed to the United States, the borrower is not eligible until the delinquent account is brought current, paid or otherwise satisfied, or a satisfactory repayment plan is made between the borrower and the Federal agency owed and is verified in writing.
Tax liens may remain unpaid provided the lien holder subordinates the tax lien to the FHA insured mortgage loan. If any regular payments are made, they must be included in the qualifying ratios. Since the IRS routinely takes a second mortgage position without the necessity of independent documentation, eligibility for FHA mortgage insurance will not be jeopardized by outstanding IRS tax liens remaining on the property unless the FHA mortgage lender has information that the IRS has demanded a first mortgage position.
