Mortgage / Escrow Process

[Anonymous]

Hello all, I'm very new to this so hear I go. I currently owe both state and federal taxes and am currently making installments payments with them. At the same time, I have been approved for a loan to buy a house, offer has been accepted and its about to go into escrow. My question is, will there be a problem closing escrow since I owe money to both state and federal goverments? Like I said above, I am making installements payments with both. What exactly happens in escrow? What kinda checks do they do from the buyers side or is it all from the sellers side. Thank you all very much for your time and I really hope to learn a lot from here.

[ShanetheMortgageMan]

Since you are on installment plans, and if the payments have been made on time for the duration of the plan, then it's possible for an FHA loan to not require them to be paid but will include those payments in your debt to income ratio.

In escrow the title company searches for any public records from the seller & the buyer... so if you have tax liens, they will show up on title when the public records search is complete.  It'd then be up to the lender if they would require those tax liens to be paid or if your installation payment agreement plan is acceptable for not requiring them to be paid.