@Anonymous wrote:
Hello,
This is my first time posting here. I'm getting ready to send in a payment agreement for some state income taxes that I owe. It's an agreement to pay so much per month and they take it straight out of your checking account. It says on the form that they will file a state tax lien to protect the state's interest, but that they will release the lien after the debt is paid. I'm not sure how I feel about this. How badly will this affect our credit scores? My husband's score is in the mid 700s and mine is around 700.
It would be very difficult to pay this all of at once (maybe impossible), but I don't want to impact our credit score since we are interested in refinancing our house soon. Will it only be considered a negative while unpaid, or will it still be negative once paid?
I was told that they don't report it to the CUs, rather that they pick it up on their own since it will be a public record.
Welcome to the forums.
Any public record like a tax lien is considered a major derogatory and will hurt your scores quite a bit but it's hard to say exactly how much because often it depends on what your reports look like before the PR is added.
It is scored the same whether paid or unpaid although a lender might look more favorably in manual underwriting if it was paid.
A paid lien will stay on your reports for 7 years and although an unpaid tax lien can theoretically remain forever they too usually drop off after 7 years.
From a BK years ago to:
EX - 9/09 pulled by lender 802, EQ - 10/10-813, TU - 10/10-774
"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".
