< Back to JVM's Blog

Must Pay 2010 Taxes Owed Before You Buy

We have a borrower buying a $300,000 home with 5% down ($15,000). He has $20,000 in the bank, and ample 401k funds for reserves. And the seller is paying closing costs.

The problem?? He owes $12,000 in taxes for 2010. He was hoping to just not pay his taxes until after close of escrow, but, unfortunately, the lender will likely find out about his tax liability and demand that it gets paid before close.

A possible way around this is to file an extension (not file until August or October), and to not declare any liability on the extension request. This, however, will result in penalties, so it is not something we recommend unless it is absolutely necessary.

Jay Voorhees
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 1197176, NMLS# 310167