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Mechanic's Lien 101: What You Need to Know to Get Paid

Mechanic liens are a powerful tool in the construction industry. They exist to make sure construction project participants get paid for the work done. If you're involved in the construction industry, it's essential to know how these liens work and what steps must be taken to ensure you get paid when you're supposed to.

What Is a Mechanic's Lien?

First, you need to understand what a mechanic's lien is. A mechanic's lien happens in the construction industry when a contractor performs work to improve a property but doesn't receive payment for the completed work. The unpaid contractor can place a lien on the improved property, acting as collateral on the property until they receive their payment.

A lien guarantees an obligation. This means the property owner can no longer ignore the fact they haven't paid their contractor. A mechanic's lien makes it almost impossible for the property owner to sell or transfer ownership of the property until the payment has been made and the lien is lifted.

Why Should You File a Mechanic's Lien

Did you know that only about half of all contractors get paid in full on their projects? This makes it hard for contractors to pay their bills on time because they aren't receiving their expected income. These numbers are why mechanic's liens are so crucial in the construction industry.

You can file a lien even when you don't plan to follow through. Contrary to common belief, filing a lien doesn't always mean there's an issue. A lien simply makes it much more likely to receive your owed payments, even if the property owner declares bankruptcy

Steps to Follow to File a Lien

If you've decided it's time to file a lien to ensure you get paid on a project, you must follow the proper steps to ensure you're doing everything legally. Here is a rundown of what the basic process looks like when filing:
* Notice of Intent: A notice is filed and sent to the owner, specifying the amount they owe you. This is considered a warning, with the hope that a payment will come through before the lien is filed.
* Prepare the Lien: This step includes collecting proper paperwork, such as a notarized statement, a breakdown of the unpaid bill, and any interest or fees included. Double-check the lien for accuracy before filing to avoid legal repercussions, including fees for intentional dishonesty.
* File and Serve: Now it's time to file the lien. This step is done through the proper county clerk's office within the allotted time. From there, the county clerk will ensure the lien is served to the appropriate people.
* Post-Filing: After the lien is filed, the property owner is given a period to pay their debt before the state takes further action.

Final Thoughts

Filing a mechanic's lien is a serious action that takes a lot of preparation. If you want to make sure you get paid for your unpaid projects, contact Nationwide Notice. Our team will walk you through preparing and filing your lien, ensuring you're paid the money you deserve.