If you work in the construction industry, you’ve likely heard of mechanics lien rights. Mechanics lien rights are unique to the construction industry and are a powerful tool to protect your right to payment.
But what exactly are lien rights, who has them, and how do you protect them?
Read on to learn everything you need to know about lien rights.
What Are Lien Rights?
To understand what lien rights are, we first need to understand what a mechanics lien is.
A mechanics lien is a legal claim placed on a property in the event of a slow, short, or no pay situation after work, labor, and/or materials have been provided. The lien enables the claimant to foreclose on the property and can prevent the property owner from selling or refinancing the property until the debt is paid.
Mechanics liens are essentially the last line of defense to ensure you get paid for your work. They provide a level of security and a means to collect payment if you are not paid for your services.
Lien rights are the legal authority you have to file a mechanics lien.
Who Has Lien Rights?
Lien rights are available in all 50 states and generally apply to anyone who has provided labor or materials to improve a property. This can include contractors, subcontractors, material suppliers, equipment rental companies, and laborers.
However, lien laws differ by state, so there are exceptions. Because of this, it is important to be aware of the exact mechanics lien laws in your state and county before beginning any work.
Additionally, while lien rights may be available to you in your state, your actual right to file a lien and enforce it needs to be preserved. A mistake, such as missing a deadline or filling out something incorrectly, could result in your lien being rejected or the complete loss of your rights.
How to Protect Your Lien Rights
The first step toward protecting your mechanics lien rights is to send a preliminary notice. Prelims serve to inform the property owner and other responsible parties of your involvement with the project and that you have the right to file a lien if you are not paid.
In most states, preliminary notices must be sent at the start of a project, and strict time frames must be adhered to. For example, California and Arizona have a 20-day preliminary notice. That means the prelim must be mailed within 20 days of the project’s start.
Additionally, it’s important to keep accurate and detailed records of all work you perform, materials you provide, and invoices. This information will be necessary if you choose to file a lien.
Finally, be aware of the exact lien laws, rules, and regulations that apply to you when filing a mechanics lien and even after. Mechanics liens are not evergreen, and your right to enforce a lien will eventually expire.
Filing a Mechanics Lien with CNS
Mechanics liens are an essential tool for contractors and suppliers to ensure they get paid for their work when experiencing slow, short, or no pay situations. As such, it is imperative that you maintain and protect your lien rights.
However, the state-by-state differences in lien laws can pose challenges.
At CNS, we have been providing contractors, subcontractors, suppliers, and other construction-related entities with mechanics lien services for over 38 years.
Our mechanics lien services are designed to make the process quick and easy for you while verifying that all information in your mechanics lien adheres to your specific state and county laws.
Contact us today to protect your lien rights and ensure you get paid for the work you’ve done.
Prefer to call? You can reach us at 800-366-5660.
Disclaimer: CNS is not an attorney, and if you need legal advice, please contact one.