What Is a Tax Lien — and What Happens If You Ignore It?

A tax lien is one of the most misunderstood situations in real estate. Many homeowners on Oʻahu receive notice of a tax lien and either panic or do nothing — both can be costly mistakes.

What is a tax lien?

When property taxes go unpaid, the government places a legal claim — called a lien — against your home. In Hawaiʻi, this is handled by the City & County of Honolulu (for Oʻahu properties). A tax lien doesn't mean you immediately lose your home, but it does mean the government has a legal interest in your property that must be resolved before you can sell or refinance.

What is an HOA lien?

If you live in a condominium or planned community, your homeowners association (HOA) can also place a lien on your property for unpaid dues or assessments. Under Hawaiʻi law (HRS Chapter 514B for condominiums), HOA liens can carry significant enforcement rights — including, in some cases, the ability to initiate foreclosure proceedings independently of your mortgage lender.

What happens if you ignore a lien?

Ignoring a lien doesn't make it go away. Over time:

• Interest and penalties continue to accumulate
• The lienholder may escalate to foreclosure proceedings
• The lien attaches to any future sale — meaning it must be paid at closing
• Your credit may be affected

What options might be available?

Many homeowners don't realize that liens are often negotiable — especially when there is genuine financial hardship. Options that may exist include payment plans, settlements, or in some cases, lien removal programs. The most important thing: don't wait. The longer a lien sits, the more limited your options become.