Back in the 1980s, in Roseville, California, I was working with a young builder who wanted to buy a lot and build a spec home.

Even better, I had a buyer lined up for the home he planned to build.

We found a nice lot for $36,000, got it into escrow, and my builder/buyer signed final papers as we prepared to close on the lot.

Title companies are pretty smart; they always run a last-minute lien search on the buyer, seller, and property before closing an escrow.

This time was no exception.

On closing day, I got a call from my escrow officer, informing me that the IRS had filed a lien on everything the builder owned the day before closing.

That killed the deal because the title company couldn’t issue title insurance with the IRS lien in existence.