I have very good credit (701)and qualified for down payment assistance program in arizona due to income limites and being only bread winner in my

Asked by azrentandbuy, El Mirage, AZ Thu Sep 8, 2011

family of 4. my husband has a tax lien and we have filed an offer in compromise. if the irs doesn't accept our offer, am i able to buy a home still? the loan would be in my name only since i am sole provider. he has been laid off for over 3 years and now that i am making decent money, its in our best interest to purchase while rates and terms are within my range. any suggestions if it doesnt get accepted.
my rent is $1018 and can purchase for $90k and paymetns are under $800 right now.... seems logical and a basic survival to purchase right now

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Bill Parker, CPA*’s answer
Bill Parker,…, , Scottsdale, AZ
Thu Sep 8, 2011
BEST ANSWER
Hello azrentand buy:

Well, after reading the responses below, I guess it is time for a lender to weight in here.

Congratulations on your good credit and making decent money--two of the essentials of home buying. I guess my question is what type of down payment assistance (DPA) are you getting? If it is a federally sponsored program and, as you say, "we have filed an offer in compromise" which may not be accepted by the IRS, the chances of you being approved are slim, as the lien is on your future income and assets also. It has nothing to do with running your husband's credit, as the lien is also in your name.

If the DPA is State or Local, they may or may not have such constraints. You really need to pick a lender so he/she can look into your specific DPA program to come up with a definitive answer for you.

Bill Parker, Loan Officer
AZ Lic# 09011570
NMLS #223607
CPA--Licensed, no longer practicing

Legacy Group Lending, Inc.
15333 N. Pima Road, Suite 300
Scottsdale, AZ 85260
(O) 480-993-3080; (M) 602-565-3646; (F) 480-993-3081
EM: Bill.Parker@Legacyg.com
Website: http://www.LegacyG.com

MISSION STATEMENT: To create an unbelievably enjoyable experience for my clients, while guiding them through the most important financial transactions of their personal lives. My clients know me as their Mortgage Lender for Life. I truly appreciate your referrals.

If you think it's expensive to hire a professional to do the job, wait until you hire an amateur.
Red Adair, Oil well firefighter
1 vote
Fred Shocklie, Agent, Peoria, AZ
Thu Sep 8, 2011
If you are using an FHA loan, this may cause a snag. It is my understanding that credit for both spouses has to be run. This is something you should definitely discuss with your lender before you put an offer on a home.

Fred Shocklie
Owner and Real Estate Consultant
602-330-1840
Web Reference:  http://www.morechoices.net
1 vote
Eric Maughan, Agent, Peoria, AZ
Thu Sep 8, 2011
You should be able to get a loan and home in your name only. With no Credit check of your husband, so long as you are not using any of his income to qualify. That said I am not a mortgage Broker but Rather a Realtor so that question should be posed to a mortgage Guy. It is easy and free to have a Mortgage borker prequalify you for a loan, once you have that, home shopping is Fun. And with the current low rates and depressed housing prices Now is a Remarkable time to lock in a low payment on a great house.

Below is ONE source for a mortgage, But there are many others. Leo will take care of you, let him Know I sent you.

Leo Zuniga
Mortgage Banker
V.I.P. Mortgage Inc.
8414 North 90th Street Suite 102
Scottsdale, Arizona 85258
http://www.loansbyleo.com
Se Habla Espanol

Direct: 602-332-0420
E Fax: 602-650-0668
1 vote
Bill Parker,…, , Scottsdale, AZ
Tue Sep 13, 2011
Hello Again Azrentandbuy:

The following is what I got back from a CPA I know. In summary, it appears the IRS can come after you and your property, even if the lien is just on your husband, as you now live in a community property state. If the lien appears on your credit report or any other public records, chances are the lender will find it. They will then be faced with determining if you can afford the home should your wages be garnished AND if the home could end up with an IRS lien on it, which may cloud their title. YOU ARE BEST SERVED BY CONTACTING A TAX ATTORNEY, with whom I can put you in touch when ready.

RESPONSE I GOT (EDITED TO REMOVE TAX CODE "LEGALESE" FOR EASE OF READING)
You ask, “If the husband owned the business back in Michigan and the tax lien is in his name only, can the IRS go after her? Does the lien relate to one tax year? Assuming it does, did they file joint or separate in that year? I would think that the answer would be “no” if they filed separately and, most likely, “yes” if they filed jointly

I don't think that the fact that the husband's liability arose in a separate property state is particularly relevant. What we need to know is whether the IRS can levy the liable spouse's community property interest in the non-liable spouse's earnings. The Internal Revenue Manual addresses this issue as it relates to levies below. It does appear that the wages can be levied.

Levies Against a Nonliable Spouse to Reach a Liable Spouse's Share of Community Property
1. In all of the community property states, in some circumstances, it is possible to serve a levy on the nonliable spouse’s salary or wages to reach the liable spouse’s community property interest. Special issues arise with respect to such levies.
A. A levy against a nonliable spouse’s wages to reach the liable spouse’s share of community property is not subject to a continuous levy under IRC 6331(e)… A levy to reach a liable spouse’s community property interest in a nonliable spouse's wages is not continuous, because those wages are not earned by the “taxpayer,” the person against whom the tax liability is assessed. Thus, the Service must issue separate levies to reach each wage payment.
B. A nonliable spouse may claim an exemption for levied wages. The Code provides for a minimum exemption from levy for amounts “payable to or received by an individual as wages or salary for personal services....” IRC 6334(a)(9). The nature of the property levied upon, i.e., the fact that it is wages or salaries, is determinative. The fact that state community property law may create a property interest in income on behalf of a party other than the party who actually earned the income does not alter the nature of that property. As the purpose of the wage exemption is to ensure that persons whose salary has been levied have some funds to meet their living expenses, a nonliable spouse whose wages are levied upon may also claim an exemption.

Best of luck to you. Bill.
0 votes
Bill Parker,…, , Scottsdale, AZ
Mon Sep 12, 2011
Hello azrentandbuy:

Sorry, I was over visiting my daughter in CA this weekend. Just getting to your request.

As I indicate, I am not a practicing CPA, so I am going to ask some of my "real" CPA friends what impact such a lien and Offer In Compromise will have on you. I will be back to you as soon as I hear.

Take care.
0 votes
azrentandbuy, Renter, El Mirage, AZ
Fri Sep 9, 2011
just wanted to let MR. Parker know, this tax lien was incurred in Michigan and is not in my name. Was my husband's bisiness and I paid my traxes seaprately every year. The tax lien is in his name only, not mine. Any suggestions?
0 votes
Sean Heideman, Agent, Phoenix, AZ
Fri Sep 9, 2011
Hi AzRentAndBuy,

You will want to speak with a lender that can help answer your questions. The mortgage rules and regulations are constantly in fluctuation so you will want to speak with a loan officer that keeps up-to-date with all the changes in the industry. I can provide you with a few referrals to some very good loan officers that can help answer your questions. I would shop around a little as well and if you get denied by one, then it does not necessarily mean you are not qualified because maybe the LO has not done their homework. Good luck and please let me know if you need any further assistance.

Sincerely,

Sean Heideman, Realtor
ZipRealty, Inc.
Office: 480-213-5251
Fax: 888-266-5657
heideman1552@yahoo.com
0 votes
Lucinda Tkach, Agent, Scottsdale, AZ
Thu Sep 8, 2011
That would be a lender question. I have some resources for other contacts to assist with guidance. A cpa and attorney may be necessary too.

Feel free to contact me anytime!

Regards,
0 votes
Dp2, , Virginia
Thu Sep 8, 2011
You might also want to consider buying with creative financing.
0 votes
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