State tax liens are among the few exceptions to first in time these jump to the head of the line regardless of when they were recorded. The IRS, however, has 120 days to redeem the property, meaning that it can pay the purchase price of the house and pay out the first mortgage to preserve its claim.
The first mortgage holder can foreclose on the property and wipe out the IRS lien. For example, if a property has a first mortgage for $150,000 recorded in January 2009 and an IRS tax lien for $45,000 recorded in October 2011, the first mortgage lien is superior to the tax lien. A property will become subject to foreclosure whenever 3 years have elapsed from the. in the registry of deeds shall create a tax lien mortgage on said real estate to.
This ranking also applies to IRS tax liens. The remedy for real property delinquency is Property Tax Foreclosure. Title 36, 943 Tax lien mortgage redemption discharge foreclosure. This is called the "first in time is the first in line" doctrine. Most liens are ranked based on the date the lien is recorded. If you purchase a property at a foreclosure auction and later find that there is a government lien or lien that survives the foreclosure auction, you will be. To determine what happens to each of these encumbrances when a house is foreclosed upon or sold, each is assigned a priority as to when it must be paid in relation to other liens.
A property may end up with several mortgages and liens against it over time. Suit may be brought for foreclosure of the federal tax lien and to subject the underlying property to payment of the tax.