The answer most of the time is yes, even if it is an IRS lien. A buyer with a lien is not a deal-killer.
Purchase money mortgages take priority over judgment liens and state income tax liens. The Federal tax code even puts the IRS behind a purchase money mortgage.
Some attorneys would not close the sale with an IRS lien filed against the buyer. To keep them on schedule to close the next day, we explained how we could insure title to the lender and buyer, even with an IRS lien, and they closed as scheduled.
Buyers still must be searched for liens, because we don’t want to surprise them if they ever go to refinance or sell their property. Those liens then would have to be paid in full at or before closing.
John C. Bennett is a real estate closing attorney and owner of Origin Title and Escrow, Inc.. Since 2003, Origin Title has handled real estate transactions – purchases, refinances, reverse mortgages – quickly and professionally. There will be no surprises, nothing misunderstood. Title searches are thorough and well-reasoned, to avoid unpleasant surprises later down the road. Calculate your closing costs in Georgia or Florida using our calculator or contact Origin Title using this form.