A contractor’s lien is also called a construction lien or a mechanic’s lien. It’s a claim that a contractor or subcontractor that has worked on a property and not been paid yet makes. Suppliers of the materials used on a construction project can also file a contractor’s lien. There are places where professionals like engineers, architects, and surveyors also have the right to file liens for the services they deliver on construction projects.

Contractor’s Lien Priority and Waivers

Lien’s priority on a building project is not dependent on the time a particular job is completed. Instead, it depends on everything that relates to the visible start of the work. This implies that the final work like painting has the same priority with the initial work like laying the foundation.

As such, the owner has to get lien waivers or releases from the material suppliers and subcontractors throughout the entire construction project. Without releases or waivers, the entire project can be subjected to liens by all subcontractors. This can happen even when the general contractor has been paid the agreed amount in full but did not pay subcontractors.

Contractor’s Lien Notification

There are states where subcontractors and contractors are required by the law to notify property owners before they file a lien. However, subcontractors and contractors are allowed to file a lien without notifying the owner in some states. Subcontractors and contractors are basically the lien claimants and this legal doctrine protects them. That’s because all their labor and materials are buried in a real estate project once they play a role in it. Contractor’s lien is different from a mortgage lien since these claimants’ liens can’t force a foreclosure.

Laws on contractor’s liens tend to confuse some people. It’s therefore important to conduct some research on contractor’s lien before you involve yourself in a construction project.