Many contractors whose clients haven’t paid them try to resolve the issue on their own. Perhaps you’ve considered filing a mechanic’s lien. Maybe you are beginning some of the paperwork already. It’s certainly an effective tool to get you paid, but the process to reach the end goal is a complex one. So how do you know it’s time to ask an attorney to help with a mechanic’s lien? That’s what we’ll answer in this mechanic’s lien article.
Reasons to Consider Help with a Mechanic’s Lien
You’ve Never Filed a Mechanic’s Lien
If this is the first mechanic’s lien you will file, you’ll probably be surprised by the lengthy process. It involves various deadlines. You’ll have to draft a number of documents. Some of them have to be notarized. You have to file them at the appropriate office, and so on and so forth.
And, and this is a big and, if you miss a deadline or perform any of the required steps out of order, you can nullify the lien.
Here’s an example:
Let’s say you and the homeowner have an argument that you can’t seem to settle. The homeowner threatens to withhold his final payment. In turn, you decide to place a mechanic’s lien against his property.
Filing deadlines can vary, but let’s say you provided only the labor for the project. In that case, you have two months to file the proper paperwork with the court. And, no later than ten days before you file the lien, you must give the property owner a Notice of Intent to Lien.
If you miss either deadline, you nullify the lien.
Taken one step at a time, filing a lien may seem simple, but as a whole, it can become pretty complicated.
For instance, the lien statement must clearly list:
- The name of the property owner;
- the name of the creditor of the contractor (the person or company seeking payment);
- the name of the person or company that furnished the labor or materials;
- the name of the primary contractor, when the lien is claimed by a subcontractor;
- the address or a description of the property where the work was performed;
- the amount owed;
- and is the claim signed by the claimant?
If this information is incomplete or inaccurate, your mechanic’s lien may be found invalid.
You also cannot overstate how much your client owes you. An excessive lien can be voided by the court, and a judge could order you to pay for your client’s attorney fees and court costs.
The Court’s Zero Tolerance Policy
The court does not care whether a contractor has any legal experience or knowledge about mechanic’s liens. The court system will not provide you a legal advisor to walk you through the process.
Perhaps more importantly, a judge will not accept your lack of understanding of the law or mechanic’s liens as an acceptable excuse for a misfiled document or forgotten deadline.
For What it’s Worth…
No one would ask an attorney to act as their contractor on a home remodeling project, nor would they ask a building contractor to represent them in court.
If you choose to file a mechanic’s lien on your own,
the court will expect you to know the proper procedures as if you are an attorney.
More About the Mechanic’s Lien
A lien is just a formal legal term for an outstanding debt against someone’s property. If a homeowner stiffs you, you can place a mechanic’s lien against the value of their property as a way of collecting on the debt.
A lien creates a financial burden against the homeowner’s property. Most states, including Colorado, have laws that make it illegal to sell a property with a lien against it. That means the debt must be settled before the property can be sold.
In the most extreme cases, you can use a mechanic’s lien to force the property into foreclosure. Under foreclosure, the property will be sold to repay the outstanding debt.
Learn more about the mechanic’s lien process when you click here.
How an Attorney Can Help with a Mechanic’s Lien
When you hire a real estate attorney who has a background in mechanic’s liens, you’ll work with someone who has been educated about the rules and has practical experience with the process.
Your lawyer will review the documents associated with your case to look for problems that could void your lien, and they’ll examine it to ensure it contains the correct, legally-required information.
If You Have a Job That Goes Off Track…
As a contractor, you’ll pull out all the stops to give your client a great finished product. They’ll be happy, and you’ll get paid on time. This is the scenario everyone hopes for. Unfortunately, as you know, glitches will crop up along the way.
If you run into a problem where your client has left an unpaid balance, the mechanic’s lien may be your answer.
How Much Will a Mechanic’s Lien Attorney Cost?
We know you don’t want to spend more money if you don’t have to, especially if you’re already owed money by a delinquent homeowner. But in this case, hiring an attorney could save you money in the long run. Potentially a lot of money.
The cost of the attorney depends on where you are in your case and which attorney you hire within the real estate practice.
Having an attorney draw up a standard contract to can use with your clients before a job starts is a good way to avoid serious conflict and legal action later on.
If you are not familiar with the process of creating a contract or processing a lien, consider hiring a professional.
Schedule a case assessment
A real estate attorney at Robinson & Henry is experienced in the workings of filing a mechanic’s lien. And they are able to represent you in court should it come to that.
Contact us for a initial assessment at 303-688-0944, or you can schedule it yourself online when you click here.
An experienced real estate attorney can work with you to make sure each step is followed carefully and deliberately so that you can effectively pursue the payment owed to you.