Who pays the back property taxes on a house for short sale?

The bank would have to pay them in order to convey a clear title. disclosure I am not an attorney

I should add
that they WILL try to get the seller to pay them and could hold the escrow hostage of they don’t.

Just made an offer on a short sale property, every possible thing is covered in the contract.

It tends to be negotiable. The seller should pay it all off, but sometimes it goes back to the lender, and sometimes if the price of the house is low enough the buyer might even pay the liens and taxes. Basically, it will all have to be paid in order for the closing to go through and for you to be able to get title insurance.

So you need to sit down with all the parties involved (or your real estate agent does) and find out exactly who is to pay what. If the choices are satisfactory to you, then go through with the sale. If not, then walk away.

However, if you make an offer on the house and the title cannot be cleared you should get your money back.

In the state I live in, any leins or back taxes owed is paid by the buyer. We bought a house on a short sale about two years ago and there was a tax lein on it and we paid it.

The seller probably can’t afford to pay them, and neither you nor the bank wants to pay them. This is all subject to negotiation, just like most other aspects of real estate transactions.

You offering $200,000 with the bank to pay $10,000 in back taxes is basically indistinguishable from you offering $190,000 with you to pay the back taxes. The difference is likely to be that the bank will have the cash on hand to pay the $10,000 in back taxes, while you won’t, and so from a logistical point of view you prefer $200,000 with the bank to pay back taxes.

Cwilber
Not sure where you live, but, in the state I live in, there a no negotiating. The buyer is responsible to pay any liens.

@basp: There’s always negotiating. The buyer can say “I have $10,000 in liens to pay, so I’m going to offer you $200,000, and at closing time you’ll give me $10,000 to pay off the liens.”

The the thing is there is not that much negtiation on short sales because the price is already pretty low. In the area where I an looking prices have dropped 40% in the last year. I offered full price on a condo with seller paying closing costs. The condo sold for $190,000 in 2006 (new) but was listed for $110,000. We got word there was a a matching offer so I went up $5,000 but the other guy got it for list price because he had all cash.

The offer I made on Monday was $5,000 dollars over list price on a cute little house w/i 24 hours of listing, Two days later there were 8 offers. So in this area there are no negotiations on these under priced shortsales. If you won’f pay the price someone else will’

galilegirl
That’s right. Short sales don’t allow for much in the way of negotiating.