I am on an installment plan with the IRS and in good standing with about 14k outstanding and as I only bought the house last June and have not filed for 2008 yet, there is no a lien filed specifically against the house. I am guessing that may change after I file on 10/15 and take advantage of tax credts and deductions. Will I be turned down? Should I apply?”
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Most lenders will want to see the lien lifted first, or a letter from the IRS acknowledging an inferior position to the lender. If you have not even filed yet, that’s not going to happen.
Realistically it is probably not going to happen. However, if you can convince them that you have a steady income stream and maybe a few dollars set aside, they might work with you. Also, a decent credit rating helps quite a bit.
IF you are NOT delinquent and are regularly paying, the IRS is unlikely to go to the trouble of placing a lien on your house.
Having a tax lien, or tax liability, is additional debt, which reduces your chances of obtaining a mortgage. If you also have other debts and your debt ratio is too heavy, you won’t qualify for a new loan, for a refi. You might qualify for a Loan Modification, so check that out.
Qualification for a refi is just like qualification for any other mortgage, and underwriting standards are fairly strict. Since you just bought this house, if you have NOT increased your debt, you may qualify. You need Good Credit, Stable Employment, Adequate Income, Sufficient Equity (or down payment), Low Debt Ratio.
Why do you want to refi such a recent loan?