Understanding Tax Liens

If you’re selling a property with tax liens, it’s essential to understand the amount of the lien and any other debts that may be attached to the property. It’s also important to know whether the lien is still active or has been released. An active lien means that the government or third party still has the right to collect the unpaid taxes, while a released lien means that the debt has been paid or otherwise resolved.

To resolve a tax lien before selling your property, you’ll need to pay off the outstanding balance or negotiate a payment plan with the lien holder. It’s also a good idea to obtain a lien release certificate, which will provide proof that the lien has been resolved and is no longer active.

If you’re able to find a buyer for your property with tax liens, you’ll need to negotiate the terms of the sale. This can be a complex process, especially if the tax lien is a significant amount.

One option is to offer to pay off the lien at closing. This can be a good option if you have the funds available and want to make the sale as smooth as possible. However, if you don’t have the funds to pay off the lien, you may need to negotiate a payment plan with the lien holder. This can involve agreeing to pay off the lien in installments over a set period of time.

Another option is to negotiate a lower sale price in exchange for the buyer taking on the responsibility of paying off the lien. This can be a good option if the tax lien is a significant amount and you don’t have the funds to pay it off. However, it’s important to be realistic about the property’s market value when there is a tax lien in place.