Which type of lien is based on unpaid property taxes?

• A. Mortgage lien
• B. Tax lien
• C. Mechanic’s lien
• D. Judgment lien

Answer: (B)

A tax lien is specifically linked to unpaid property taxes. When a property owner fails to pay their property taxes, the government can place a lien on that property as a means to secure the unpaid taxes. This lien ensures that the government has a legal claim against the property until the taxes are paid. The presence of a tax lien typically takes priority over other claims or liens on the property, making it a significant concern for property owners. It is a legal mechanism that allows the government to recover owed taxes and can lead to a tax sale if the debt remains unresolved.

In contrast, a mortgage lien is created when a borrower takes out a loan secured by the property, while a mechanic's lien arises from unpaid construction work or materials provided to improve the property. A judgment lien results from a court ruling in favor of a creditor and is based on a monetary judgment against the property owner. Each of these liens arises from different circumstances and obligations, but only a tax lien specifically relates to unpaid property taxes.