Suppose you are a homeowner and have done renovations on your house. You have cleared all the payments to the contractor you agreed upon. But instead of paying subcontractors and suppliers, the contractor has kept all money to himself. You will be responsible for the payments subcontractors, and suppliers have not received. Per law, subcontractors can come after you if they have not been paid by the contractor. In this case, you will possibly be paying for work twice, or you will have to sell your property.
In this article, you will read about the basics of a Mechanic’s lien and how it works.
(Note: this article does not provide legal advice and is just a beginner’s guide).
Understanding Mechanic’s Lien
A mechanic’s lien is also referred to as a construction lien or material man lien. This law is specifically passed in favor of those workers employed on a private project who don’t get paid for their services. An interesting fact about Mechanic’s lien is that it gives favorable rights to workers and gives them a guarantee of payment.
A mechanic’s lien is a legal claim against your property. It is conventionally used by the subcontractors and suppliers that when they have not received their payment for the work they have done in renovating the house, they can claim a legal lien on your property to get their payments. Generally, anyone who works on or supplies to an under-construction property can claim a lien that includes contractors, subcontractors, suppliers, design experts & construction instrument rental organizations. But, it varies from state to state as every state has regulations regarding a Mechanic’s lien.
Why Mechanic’s Lien Are Legal & Allowed:
Though, it is unfair that you will face the consequences for the irresponsibility of the contractor. However, the fundamental of allowing the Mechanic’s lien is between the property owner (you) and the employees working on a project. The law is more in favor of workers who need to get paid.
According to this law, if you get a mechanic’s lien claimed on your property because the contractor didn’t pay the employees, but the contractor himself lost all money in gambling, you can easily sue the contractor and file a lawsuit against him and can get his wages or ask him to sell any of his property. But it is a long-term process and doesn’t work in the short run. Furthermore, getting money from someone who doesn’t pay his subcontractors is difficult. However, if you commit a specific time to pay suppliers, you must fulfill the commitment; otherwise, you will be forced to sell your property to clear the Mechanic’s lien against you.
Filing a Mechanic’s Lien-How, Does it Works?
Filing a Mechanic’s lien is not usually difficult, but some steps must be strictly followed to get your claim. To file for a Mechanic’s lien against the property, most states usually require the lien claimer to follow these steps:
- The lien claimer should notify the homeowner within 20-30 days of the contribution.
- If they still don’t get paid, they can file a Mechanics’ lien with the county clerk of the country where the property is located.
- Provide a copy of the Mechanic’s lien claim to the property owner & other lenders involved. In the case of subcontractors, a copy of the claim should also be given to the general contractor.
- The Lien claimer should work out any solution with the homeowner in 2-6 months, or he can file a lawsuit against the property owner if he doesn’t get paid.
Final Verdict:
It is good that owners and contractors act responsibly to make payments on time to avoid such consequences. In this article, we have explained a basic guide to help you understand a Mechanic’s lien. I hope you find this article useful. Further, go to www.mechanicslien.com to read in detail about Mechanics Lien Law.
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