What is the first debt to be paid when a home is sold to settle unpaid debts?

When a home is sold to settle unpaid debts, tax liens take priority over other types of debts. This is because tax liens represent debts owed to the government, and they have a higher legal standing compared to other claims against the property. When a property is sold, any amounts owed for property taxes must be settled first before any other liens or debts can be paid.

Tax liens are typically recorded against the property and can lead to foreclosure if the taxes remain unpaid. This priority is established by law, ensuring that government entities receive the funds they are owed. Therefore, when analyzing the order of payment in a property sale, tax liens will be addressed first, securing the government’s claim to ensure funding for public services.

In comparison, while mortgage liens, property taxes, and judgment liens also hold significant importance in the hierarchy of debts, they come after tax liens in the order of priority. Mortgage liens are typically paid after property taxes, and judgment liens depend on the specific legal circumstances of the debt involved. This hierarchy emphasizes the government's priority in receiving tax revenue, which is essential for maintaining public services and infrastructure.