Valued Contributor
Posts: 2,669
Registered: ‎04-25-2011
Re: 2011 IRS Installment Plan and Closing

Dagstar wrote:

I have kinda the same thing going on. I provided all the detail and documentation that I was asked for. We got an immediate approve/elligible. I understand that's the best type of response. We locked in the rate and away we go. Now, I get the forms in the mail and they want me to sign a 4056t form. I was not asked to provide tax information before....just w2's. My concern is that for our 2011 taxes we owe more than ever before. I filed the takes on time and started to request an installement agreement online, but could never get it past the 1st screen on the irs web page.


I called the irs today. The reason I couldnt do it on their web page was because my return hasnt been processed yet. The irs agent found my return and set up a payment plan.


So, I feel I did all the responsible appropriate things I was supposed to do but I wonder about a few things.


1) Is the mortgage company even going to pull this from the IRS before my scheduled closing in 30 days? I've read that it often gets pulled after the closing and put in the file for documentation of fraud in case there is a default (for employeed applicants, not self-employeed). I've read that the IRS is taking 4-6 weeks to return these documents.


2) If it does get pulled and reviewed prior to the closing, will they use the payment plan as part of my debt to income ratio.


My gut feel is that this is simply a formality that gets put into a file after the fact since I'm not self employeed (I'm salaried) and I provided W2's, pay stubs, and documentation from my employer.


Any thoughts


Well, the transcripts will indicate that you still owe taxes for 2011, but 2011 is so recent, I don't know what the protocol is (naybe they dont look at 2011 yet?)... my lender advised me really early on that this would happen (the transcript pulling), and I had to pay off about 9k of back taxes prior to apping for the house as opposed to payment plans..


I had to give them 2009, 2010 and 2011 W2s, my tax filings with schedules, and they were still pulling the transcripts.. I think the idea is, W2s can be faked, your tax documents can be faked, but the transcripts cannot. I can give a lender a W2 I fabricated on my computer. The only way they can verify it is to match the numbers up with the IRS


My LO (who is a poster on this forum from time to time) indicated to me that if I entered into a payment plan, they will need to see ontime payments at the minimum of 6 months (more likely a year) and that would be included into my DTI.. it just wasn't worth it for me, so I took some downpayment money to address it.

Starting FICO Score: 10/10: TU 498 | EQ: 502 Current FICO Score(lender pull): 09/14: TU: 784 | EQ: 752 | EX: 784
Collections Removed: Hunter Warfield, CBE Group, Merchants Credit Guide, EOS-CCA, Enhanced Recovery, Portfolio Recovery, UCB, American Collection Company, Medical Business Bureau, Jefferson Capital, Credit Portfolio Associates, FCO, LVNV, Convergent, Armor Systems
Other Negative Entries Removed:Plains Commerce CO, HSBC CO, 2008 Judgment Santander Reposession

Positive Accounts:10/10: 0 | 07/12: 6 | Mortgage Closed 5/12, Macy's AMEX $13900, Citi/Home Depot $8500, Capital One Cash Rewards $3500, BOA $7500 Total Utilization: 3%. AAoA: 2yr, 9mth. INQS: 1 TU, 1 EQ, 3 EX