Profile picture for changhan00

unconditional move in??

hello all
i posted before about my situation while ago. quick recap: offer accepted, then found out property had irs tax lien, sellers(REO) trying to get tax lien resolved with IRS, its been 2 months now. we should have closed june 18th. so far, sellers still waiting to hear back from IRS. they expect resolution soon.
so to make things better, they just offered us to move in to the condo unconditionally....basically move in, dont pay anything but normal uitlities until they clear title and we can close escrow. so now i have the chance to move in, dont pay anything but electricity, cable bills, etc...until we close.
is this something completely out of the ordinary? should i have anything to worry about if i accept this offer? this is in los angeles county. at first thought it sounds lot a great deal.....i think.....haha... my agent said he will make sure they sign a contract on this and make sure we get money from them if it doesnt work out and they back out of the deal (i.e moving expenses, etc). any thoughts? thanks!!!
  • July 21 2008 - US
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Answers (9)

Profile picture for Wayne.T_ .....Colo.

I'm hearing a lot of silence from everyone ..........    perhaps its because our favorite uncle has a hand in the pie.  IRS issues could take a while and they have the power of, well, themselves behind them. 

 

Personally, i would not move in until everything is clear and closed.  

IF you move in, be prepared to amke that second move if the IRS does not release its lien.  The bank could be trying to settle for less than owed to increase their profit.  It could be something entirely different. 

 

 

  • July 21 2008
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Profile picture for changhan00
thanks Wayne
another thing the sellers agent said was that if the IRS does not lower the lien amount, the sellers will pay the full amount to get the property sold and get it off their hands...
so basically my agent thinks that since they offered this move in deal they are serious about closing even if they have to pay 100% of the lien.
dont know what to think!
  • July 21 2008
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Chang, if you get it in writing, move in.  The IRS will most likely end up settling for a lesser amount on the tax lien and releasing it.  Settle now for 1/2 or wait 5 years and get the full amount, no brainer, they will settle and release.

  • July 21 2008
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Profile picture for changhan00

thanks Tammy:

i seem to be getting different answers from a lot of people. some say that if i have it in writing and cover all the bases to go for it.

some say, dont do it!!

i dont know what to think! anyone else have feedback for me?

 

another tidbit..the condo i am referring to is owned by an equity firm. i guess they bought it through foreclosure without checking on liens. opps!  from what they say, they have to sell no matter what...so they are tyring to assure us to stick around and that they will pay off the lien if the irs wont release it.....shoudl i believe them??

  • July 23 2008
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Profile picture for changhan00

hello everyone..update....still havent moved in..im on the fence so i havent signed the early move in contract (although it has all the terms that favor/protect me)

sellers still working on fixing tax lien. supposedly this friday they get a repsonse from IRS...but of course its been like this for the last 2 months.  "friday" turns into "next week" etc.

is it time for me to walk from this place??

  • September 09 2008
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yes. you were right not to move in. in that case, the irs effectively owned the house, not the seller. you don't want to get involved in that.

 

find another house. there are many out there for good deals. the good news? prices are even better now!

  • September 09 2008
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Profile picture for Mr Caveat

basically it really comes down to you dont know what is going on. the IRS cannot come after you even if you move in, however they can evict you so i wouldn't move in *completely* but rent free is rent free and worst case scenario IRS refuses to do whatever they are being asked to do(i can quite readilly assure you that they are not being asked to release a lean that has been paid off, not after 4 months) and you then lose the sale... i would jump in the "go for it camp" assuming you have a waiver prepared by a RE attourney that protects you from claims to say rent, wear and tear... probably a rental agreement too that outlines zero security, zero rent, tenants responsible for x/y/z, considered MtM, who does repairs...

 

i think that as an alternative to buying a six month lease with no security and no rent, is quite attractive. dont you?

  • September 09 2008
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Profile picture for Mr Caveat

just a side note, if you lived there you are more likely to notice imperfections that you want dealt with, an island that is always in the way or the oddness of the placement of the pantry BEHIND the refrigerator for instance, better to notice these things while the contract is malleable... also someone living there is good for the home, vacancy leads to moisture and critter problems that occupants don’t necessarily deal with.

  • September 09 2008
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Profile picture for greg1231

It doesn't seem like the matter will be resolved quickly. Request a release from your sales contract in writng, ask for your earnest money back from the sellers asap, and move on to the next house.

  • September 09 2008
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