Define: Construction Lien

A construction lien, also known as a mechanic’s lien, is a legal claim filed by contractors, subcontractors, or suppliers against a property to secure payment for work or materials provided for a construction project.

Any party who has provided labor, materials, or services for a construction project and has not been paid can file a construction lien. This includes contractors, subcontractors, suppliers, and even architects or engineers.

The time limit to file a construction lien varies by jurisdiction. In most cases, it ranges from 30 to 120 days after the last date of work or the last date materials were supplied. It is crucial to consult local laws or seek legal advice to determine the specific deadline in your area.

The primary purpose of filing a construction lien is to secure payment for work or materials provided. It allows the claimant to have a legal interest in the property, which can prevent its sale or transfer until the debt is resolved.

Yes, a construction lien can be removed if the underlying payment dispute is resolved. This can be achieved through payment, negotiation, or legal action. Once the lien is removed, the property can be freely sold or transferred.

Yes, a property owner can dispute a construction lien if they believe it is unjustified or inaccurate. They can challenge the lien by filing a lawsuit or negotiating a settlement with the claimant. It is advisable to seek legal counsel to navigate the dispute resolution process.

Yes, a construction lien can have a significant impact on your ability to obtain financing or sell your property. Lenders and potential buyers may be hesitant to proceed with a transaction if there is an unresolved construction lien on the property. Resolving the lien is crucial to avoid complications in these situations.

In some cases, a construction lien can be enforced against a property that has been foreclosed. However, the priority of the lien may be affected by the foreclosure process and the claims of other creditors. It is essential to consult with an attorney to understand the specific implications in your jurisdiction.

In most jurisdictions, construction liens cannot be filed on public projects. Instead, contractors and suppliers typically have to follow specific procedures outlined by the government entity overseeing the project, such as filing a bond claim or pursuing a lawsuit.

In some cases, parties may be asked to sign a waiver of lien rights as part of a contract or payment agreement. It is crucial to carefully review such waivers before signing, as they may limit or eliminate your ability to file a construction lien. Seeking legal advice is recommended to ensure you understand the implications of any waivers.