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FHA loan while on IRS payment plan?

Regular Contributor

FHA loan while on IRS payment plan?

So, I just did my taxes for 2011 and realized we owe the IRS a good deal of money. We made an initial payment and signed up for a payment plan. Will I be able to get an FHA loan with such a new payment plan in the works? My DTI is fine even with the monthly payment to the IRS. I've read conflicting stories online. Anybody got a definite answer? Thanks!!!!
Message 1 of 14
13 REPLIES
Regular Contributor

Re: FHA loan while on IRS payment plan?

I am pretty sure you have to have 12 payments on the plan to be considered.

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Message 2 of 14
Regular Contributor

Re: FHA loan while on IRS payment plan?

Borrowers owing the IRS are ineligible for FHA insurance, "until the delinquent account is brought current, paid, otherwise satisfied or a satisfactory repayment plan is made" with the agency and verified in writing, says FHA Outreach

I found this on another site. I've read that you have to have 12 months of satisfactory payments if you've had a tax lien but nothing definite about the payment plan. I don't have a lien. This is a voluntary payment plan and I'm current on all years before 2011.
Message 3 of 14
Regular Contributor

Re: FHA loan while on IRS payment plan?

I guess my first question would be:

 

does the IRS show on your credit report?

 

If it does not, and you are making payments, that is not a big deal.  LOTS of people owe the IRS and are making payments...

Message 4 of 14
New Contributor

Re: FHA loan while on IRS payment plan?

I am undergoing UW fro a FHA loan. We owed $3K for our 2011 and was told since it is fed taxes it would be included in our DTI regardless of the length of the payment plane. We went ahead and PIF to avoid that. Otherwise, it would have only increased our DTI. There were no other isse surrounding it. Good luck!


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Message 5 of 14
Contributor

Re: FHA loan while on IRS payment plan?

This is very good to know, I had the same question.  Thanks CaliSunshine!

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Message 6 of 14
Contributor

Re: FHA loan while on IRS payment plan?

Hmm interesting. I'm currently building my score back up, and I too am on a payment plan since 2010, I hope this doesn't come up, Jesus!!

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Message 7 of 14
Valued Contributor

Re: FHA loan while on IRS payment plan?


Klesko wrote:

I am pretty sure you have to have 12 payments on the plan to be considered.


I had a tax issue, and my LO said it is up to underwriting descretion.. Once you are on a payment plan, you are no longer 'delinquent' so you can pass FHA requirements... it is up the lender tho. Mine indicated they would want at least 9 months of on time... my debt was about 7k, so I just paid it and looked for a better closing deal from a seller.

 

 

-scott

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Message 8 of 14
Frequent Contributor

Re: FHA loan while on IRS payment plan?

bumping this theead.

 

I have an IRS PP which is voluntary.  (Although the amount of course isn't voluntary hehe).  It doesn't show up on credit reports.

 

Why even report it on the loan app?  I guess since it's FHA they will find out.

 

When i switched to USAA Banking/Inusrance they were able to see I owed the IRS taxes but they couldln't see anything more than that. 

 

I still owe around 12k so I'm not interested in paying mine off, but I'm also not interested in it affecting my DTI.  We do payment plans on debts all the time that don't count towards our DTI so why should this?

 

My daughter's band instrument wouldn't impact my DTI..........


Message 9 of 14
Frequent Contributor

Re: FHA loan while on IRS payment plan?

bump, any feedback?


Message 10 of 14