A Brief Primer on Mechanic's Liens
THE BASICS
What is a Mechanic’s Lien? A Mechanic’s Lien is a legal claim against the property for unpaid construction work. The Lien attaches to the property to provide a contractor with a security interest for the unpaid amount. These liens usually are satisfied when the property owner sells the property. However, in order to preserve the right to file a Mechanic’s Lien a contractor or subcontractor must follow certain procedures and timelines. While the general procedures are listed below, please do not hesitate to contact us with specific questions or for any help regarding filing a Mechanic’s Lien, or associated documents.
BEFORE BEGINNING THE WORK
Once a contract has been signed, but before any work has started, certain notices may be required to be recorded. Traditionally, no notice is required to be recorded for a project on a residential property, unless required by a lending institution. However, for commercial or industrial buildings, a notice must be filed to preserve the original contractor or subcontractor’s rights.
For an original contractor on a commercial or public project, we can assist in preparation and filing, or obtaining a copy of a Notice of Commencement.
For a subcontractor on a commercial or public project, we can assist in preparation and filing of a Notice of Furnishing.
Filing a Notice of Commencement or Notice of Furnishing preserves the company’s right to file a Mechanic’s Lien in the event it does not get paid for work performed or materials furnished.
AFTER THE WORK IS COMPLETED
After the work is finished, be sure to contact our office if you have not been paid within thirty (30) days of the last date that work was performed or materials furnished. Generally, a Mechanic’s Lien can be filed on a residential property within sixty (60) days after the last date work was performed or materials furnished. For a project on a commercial property, the Mechanic’s Lien must be recorded within seventy-five (75) days after the last date work was performed or materials furnished.
When the Mechanic’s Lien has been filed, the contractor gains a security interest in the property for six (6) years. If the property owner attempts to sell the property in that time, they will likely be required to satisfy the Lien. Additionally, you can contact us to discuss the method to foreclose on the Mechanic’s Lien and seek a court judgment for payment.
The information provided herein does not, and is not intended to, constitute legal advice; instead, all information and content are for informational purposes only. Please contact our office with any legal issues and we will gladly provide a consultation.