How To Stop The Sale Of A Home At Sheriff Sale - Less Than 3 Weeks!
Please Help! I'm a Realtor and I have a friend who's home is going to Sheriff's Sale in Less than 3 Weeks. There is only one mortgage however there is also an IRS Government Tax Lien against the property. The suit is for $400,000 and the tax lien is around $50,000. Without giving all the details of the owners' hardship. The spouse is separated from the husband and could no longer afford the house although she tried. Can you give me in detail what I can do to help this person postpone, cancel or stop sheriff sale and tips on how I can negotiate with their lender to possible take a short sale? Please provide whatever info you can. Thanks. 
Hi Lynn001
Re; your posts I am, not an attorney. And this is not meant for legal advise. it is offered in hopes of being helpful.
For starters the lender in all probability will not work with your friend to do a short sale. you/they may be able to work an offer and compromise with the IRS, Might want to find an enrolled agent to work with them.
Next what is the value of the property? They could sell it to someone perhaps you, and (if you or?) you file/apply for a short sale with the lender. You might also file an offer and compromise with the IRS to remove the lien from the property (it would be on the currents owners back) or offer/comproise for a reduced pay off on the lien.
They could also file a bk on the property, which would buy some limited time, it will not totally solve the problem, or make the sheriffs sale go away.
hope this helps, perhaps others will reply to your posts, knowing there are some attorneys on the site. They can either correct what I have said or agree with it.
Good luck! Keep is posted on the out come, so well all might learn from it.
Thanks
Ps/There is an investor and a couple attorneys near you in Alabama and Georgia (I know of who might guide you)PM me if you like, I do not think I can identify them on this site, and I appreciate the site enough that I do not want to jeoparadise the availability of my being on it.
Thanks Ozzie for your reply. To answer your question, the fair market value is between $299,000 - $350,000. The original mortgage pay off is around $250,000. The bank is suiting (according to sheriff sale records) for $400,000 which probably includes foreclosure fees, attorney fees, etc. Then we have to add the IRS lien and the homeowner is trying to sell on her own for $475,000 which is very unlikely and the house is not listed for sale. We only have 3 weeks and she's just calling me to tell me her situation. I do however have a pre-approved potential purchaser who says $475,000 is not a problem. Just not sure if I have enough time being it goes to Sheriff sale May 21, 2004 plus the IRS lien is still there. Thanks for your info and the offer of your attorney friend's contact info. I'll advise if I need it. Thanks again.
Ozzie - you guys can Private Message that info to each other.
You can apply for a shortsale if you're considering purchasing the house. There's not time to file bankruptcy so the best way would be for the shortsale approach.
Are you familiar with how to make a presentation for one? Reason I ask is because banks require a lot of info, etc. Get together with your friend and make a plan while knowing what all your options are.
Lynn001,
Wow! someone offering that much over fmv? In view of the short time available... Do not let the lender know the amount of your offer. Possibly you (as a realtor) can advise the lender you have a pending sale of you can get a short on the current mortage for up to 250K ??? $... Have your friend find an enrolled agent to submit an offer and compromise with the IRS. they will get nothing it seems if it goes to foreclosure Is it the IRS doing the sheriffs sale? Have her threaten bk if necessary . If it is the bank they will likely work with you, as they do not want a foreclosure if they can avoid it. And she ought to be able to show the IRS she can not pay. I just heard of a person who recently supposedly got a 100k IRS lien reduced to under 5k, there is hope!
Keep us posted, thanks~[ Edited by ozzie on Date 05/01/2004 ]
shikely,
Thanks for the heads up re: PM.
Was not certain, and do not want to make waves on here.
As for bk filings from what I gave experienced, they can be filed up to the actual sale. Have had it happen a couple times to me, filed the morning of the with the filing attorney making notice to those doing www.sale.the sale. I do not encourage anyone filing if it can be avoided, sometimes it has to be. And with bk being a federal action I suspect it is somewhat the same nationally. ???
The best to you.
Shikely, thanks for your reply. To answer your question, YES. I am familiar with short sale. I just recently (4/28) received a written approval from Wells Fargo. It wasn't easy but it wasn't so bad either. I'm to close on that property with my client whom I have it listed for, Tuesday next week. Thanks again!
Ozzie, it is the lender who is suiting at Sheriff sale and not the IRS. When you my friend should consider an enrolled agent to submit offer and compromise w/IRS, what exactly do you mean? (i.e. What is an enrolled agent and do you know how long it takes if IRS approves?) I know this question might sound dumb, but I really don't know what an enrolled agent is? Thanks.
Lynn, an enrolled agent is a tax attorney or CPA approved to work with the IRS. Most of the ones I have known are/were all former IRS agents. You can fine one as a referral perhaps through a tax attorney, a CPA, some tax accounting offices, and often from the IRS its self. Might even find one on an internet. search.
There is a form available, do not know the number, but go on the internet search engines, google, yahoo, msn or whatever for http://www.irs.gov and find the listings of forms. You/she could probably do it yourselves, but with the short time fuse you might ought to consider using an enrolled agent.
As to how long it take ??? the enrolled agent could tell you. In fact you might even call the IRS direct and inquire as to the procedure. You might find one that will have some idea...though I'd not bet the farm on that. Those that have any smarts are more difficult to contact.
I'll say no more about them, gotta be nice. ;-}
Good luck!
Ps/ the enrolled agent might be able to stall the sale as well. However you said the bank is doing the foreclosure. You
need to contact them immediately. And let them know you can get it sold in 30-60 or so days if they'll postpone the sale, and the owner is considering bankruptcy if they do not. They'll listen I am sure. As a bk will onlt delay them further and cost them more money. And time. And with a non perfroming asset on their books they lose much in not being able to write I think it is 7 times the amount of the non performing asset. It is wirth theri while to work with you.[ Edited by ozzie on Date 05/01/2004 ]
That property is not moving any time soon with an IRS lien unless some dumb investor buys it not knowing about the IRS lien.
I would hire a tax attorney - yesterday! Period.
C- :-o