Housing Counselor Certification (HUD) Practice Exam

Delinquency on which type of payment could result in a lien against a client's property?

1. Utility bills

2. Mortgage payments

3. Homeowners association dues

4. Property taxes

The correct answer is: Homeowners association dues

Delinquency on homeowners association dues can result in a lien against a client's property because most homeowners associations (HOAs) have the authority to place a lien on property if the homeowner fails to pay the required dues or assessments. This lien can be enforced through legal means, potentially leading to foreclosure on the property if the debt remains unpaid. HOAs often view these dues as essential for the maintenance and operation of community services, which justifies their right to secure this obligation through a lien. In contrast, while utility bills could lead to service disconnection, they typically do not result in a property lien. Mortgage payments are crucial for maintaining ownership, but generally, they involve lender-specific remedies rather than a lien placed by a third party. Property taxes can lead to a lien, but this falls outside the scope of homeowners association dues, which is what the question specifically focuses on.