Texas foreclosure with IRS lien

I bought a HSE at foreclosure with an IRS lien on it. The IRS says they have 120 days to redeem the property. Does anyone have experience with whether they are currently redeeming properties in Texas. I have submitted a request for release. How long does it usually take for the IRS to determine if/when they will release the property.
Bottom line is: What are my odds that they will redeem this property?

Edited: 06/26/2010 at 04:38AM

Jim Gordon

Residential Real Estate Agent · Ohio

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Feb 01 '08, 02:07 PM

This is a bad answer but it all depends. If there is a lot of equity in the property, and who knows how much a lot is, the IRS can buy you out. They will pay you the purchase price not a cent more, that is public information. Do not put one penny in the place until you get the release as you can not recoup any money you have spent on the property.
This is the big reason that most properties with IRS liens roll to the lender at auction. Let me know how it is going in about 4 months.

Edited: 06/26/2010 at 04:38AM

Eric Foster

Real Estate Investor · Portland, Oregon

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Feb 02 '08, 12:35 AM

If the property has someone in it (in the meantime) start collecting rent... If it is the previous owner, then only accept cash and don't get a rental agreement signed. But, let them know they still need to leave... And evict them as necessary... They will almost always try to stall...

But as already mentioned, don't spend any time or money on it until you know it is 100% yours...

I have done these before... And my theory was to leave the " sleeping dog" (The IRS) alone... If you think there is a chance they may redeem... Why bring it to their attention?

Edited: 06/26/2010 at 04:38AM

Jim Watkins

Real Estate Coach · Dallas, Texas

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Feb 05 '08, 02:18 AM

Originally posted by "mac66"

I bought a HSE at foreclosure with an IRS lien on it. How long does it usually take for the IRS to determine if/when they will release the property.
Bottom line is: What are my odds that they will redeem this property?

Assuming this was not a " Tax Foreclosure" and was a " Mortgage Foreclosure" ...
It takes the IRS 120 days to determine if they will redeem (those of us in these parts refer to it as, " seize" ). If they want to redeem, it has to happen within those 120 days.

During that time is a gamble for the investors who own them. Any upgrades/improvements that are made will not be reimbursed by the IRS unless they are deemed " necessary."
Investors I know, will go ahead with the repairs while gambling that they will not redeem. Either way, you are not able to sell it during the 120 days unless they release it early.

Your odds?
This is my OPINION ONLY...
I would say 1 in 100, that they will redeem.

Edited: 06/26/2010 at 04:39AM

Jonathan Katz

Real Estate Consultant · Calabasas, California

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Feb 05 '08, 12:55 PM

Originally posted by "EricFoster"

... And evict them as necessary... They will almost always try to stall...

Agreed that the homeowners that stick around till the end (post-foreclosure sale date) are the ones that may cause a little trouble for you. What ever direction you take make sure that you are aware of what the eviction times frames are and make sure that you file all documents accordingly. The moment you smell trouble you start filing. Always you stand to have damage because homeowner's at times feel that if the place is destroyed no one is going to want it. It's better not to give them too much time.

Edited: 06/26/2010 at 04:39AM

Veloz Zypher

· Birmingham, AL

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Feb 09 '08, 05:10 AM

I am in Alabama. A lot of our foreclosures have an IRS Right-of-Redemption (because of an IRS lien).
A few of the property were very good deals for the investors that bought them at the courthouse step.

I have never known the IRS to Redeem here and I work with several foreclosure investors.

I don't know if this information helps you in Teaxs.

Edited: 06/26/2010 at 04:40AM

Eric Foster

Real Estate Investor · Portland, Oregon

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Feb 09 '08, 05:53 AM

mac66,

Any updates on the house with the IRS lien?

Edited: 06/26/2010 at 04:40AM

Jim Gordon

Residential Real Estate Agent · Ohio

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Feb 09 '08, 04:09 PM

Eric given the way things are going he may not know anything until June when the timeline passes. If they do not intend to redeem the property they do not notify you they just do nothing.

Edited: 06/26/2010 at 04:41AM