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What Is a Notice of Intent to Lien in Construction

In a perfect world, every customer would pay promptly and in full and there would never be a need for a "Notice of Intent to Lien." Sadly, we don't live in such a world. It's not unusual for construction customers to drag their feet, taking as much time as possible before they pay. Sometimes, customers try to avoid paying entirely. In these cases, a mechanic's lien may be the only way to ensure that you get the money you're owed. Before you do that, though, it's important to send a notice of intent to lien. Unsure what that document might be?

What Is a Notice of Intent to Lien?

A notice of intent to lien (NOI) is exactly what it sounds like ‐ a heads-up to a customer that you're going to place a mechanic's lien on their property if you do not receive payment. You may also know this as an "intent to lien" letter.

How Does the NOI Work?

A notice of intent to lien is relatively straightforward. You complete the document (as per state and/or county requirements ‐ they can vary greatly from area to area). In some cases, you'll need to file a copy with the county clerk. Then you send the notice to your customer.
The NOI should include a few important pieces of information. These are:
* The account number
* The amount owed
* The original due date
* The date after which you will file a mechanic's lien (usually 10 days)

How Do You Send a Notice of Intent to Lien?

The NOI is a "non-required" document, which means you have flexibility in how you send it. It can be transmitted electronically or by mail. We recommend sending it by certified mail so that the customer must sign for it and you have confirmation that the notice was received.

Are You Legally Required to Send an NOI?

A notice of intent to lien is only legally required in some states. However, we recommend sending the notice even if it's not part of your formal requirements. In almost 50% of cases, an NOI encourages your customers to submit payment. It shows them that you have not forgotten about the debt and that you're prepared to take legal action to recover what you're owed.
Of course, there are other benefits here. For instance, if a customer reacts quickly after receiving your NOI, you can often salvage the business relationship. That's often impossible after placing a mechanic's lien, though. In some cases, an NOI can also make executives and other stakeholders aware of problems they might not otherwise know about, such as bottlenecks in the accounting department or poor decisions by lower-level management. That said, sending a notice of intent to lien is just part of the process. You need to track the rules by state, the time remaining on each NOI, and more

Nationwide Notice Inc.

Our goal at Nationwide Notice, Inc. is to protect receivables, regardless of the type or size of the construction company. Our expertise is assisting construction companies to get their construction payments. Our platform offers a streamlined solution to NOI management, ensuring that you're able to stay on top of the situation with our expert help. Ready to learn more? Please contact us.. Also, don't forget to explore our robust features!