Ace the PSI New Jersey Real Estate Test 2026 – Unlock Your Property Power!

Question: 1 / 400

What is a common consequence of a homeowner failing to pay property taxes?

Filing for bankruptcy

Levy against income tax refunds

Liens placed on the property

When a homeowner fails to pay property taxes, one of the most immediate and significant consequences is the placement of a lien on the property. A property tax lien gives the local government a legal claim against the property until the delinquent taxes are paid in full. This process ensures that the government has recourse to recover unpaid taxes.

The establishment of a lien means that the government will have priority over other creditors in the event of a sale or foreclosure of the property. It protects the government’s interest and serves as a potential obstacle for the homeowner, as they cannot sell or refinance the property without addressing the outstanding tax obligation. Therefore, the creation of a tax lien is a crucial mechanism that local governments use to enforce tax collection and secure the revenue needed for community services and maintenance.

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Reduction in property value

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