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Foreclosure Forum |
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Internal Revenue Service lienHello. Here's a scenario that I would like some assistance on... I'm in the process of negotiating with a foreclosing beneficiary on a property that has a market value of $130,000 when fixed up. The outstanding principle balance on the first mortgage note is $94,000. I am trying to buy the note from the beneficiary and they have accepted my offer of $25,000 (the property has numerous problems). Fix up costs will be about $44,000. The trustee sale date is in 5 days. The IRS lien is $66,700 against the wife and I have not submitted my application for an offer-in-compromise to the IRS yet. There are 3 other junior liens on the property ($11,000 second mtg., $6,000 water bill, $1,200 in unpaid local taxes). My question is two-fold...am I in a stronger position if I purchase the note from the beneficiary pre-foreclosure and then let the foreclosure proceed? Though there isn't much liklihood that anyone else will bid at the sale, would it be wiser to purchase the property from the bank after the foreclosure, at the agreed upon price of $25,000 so that most of the other liens are wiped out? If the IRS exercises its 120 day right-of-redemption after the trustee sale, at what price will they reimburse/redeem me (current market value, or the amount of the first mortgage, i.e. the $94,000 balance + interest, penalties, attorney fees, etc.)? Thanks again for the ideas!
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