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I have a short sale that has been approved by all lenders, buyer is ready and we found a California Franchise Tax Board lien on the property at the 11th hour.  It is complex but the borrower at one point deeded over the property to her father in an effort to get it into a family trust.  The father had a huge bancruptcy but the CA FTB placed a lien on all assets and this home was one of them.  We planned on paying the lien of approximately $6,000 but when we received the demand it was for $50,000 as there were liens recorded out of county and therefore not picked up by the title company and their prelim.

The property has since been deeded back to the borrower, there was never any funds transferred between father daughter or anyone else and now title can't transfer until we resolve this issue.

The CA FTB does have a policy and procedure to provide partial lien releases but they require an appraisal be performed.  The borrower doesn't have the money, the buyer is already paying the $6k as well as delinquent HOA fees and the first lien holder (who may have only performed a bpo) won't release an appraisal.

I'm hoping that there is someone out there who has worked with the CA FTB who can work with them to get this "cloud" off title so that we can close. 

None of them are easy.....thanks in advance