A statutory lien provides security that you'll be paid or otherwise compensated for the labor, equipment or materials you provide to improve real property. If the property owner does not pay, you can initiate a court proceeding to force the owner to sell property to pay the debt.
Each state has its own laws, or statutes, regarding such a lien, sometimes called a mechanic's or materialman's lien, but in general the lien is created automatically with the contract to do the work. Just the same, you'll need to follow some basic steps to make sure you can claim your lien rights:
- Check to make sure your role in the project is entitled to protection by a statutory lien.
- File forms to record the lien with the county clerk's office.
- Notify the property owner of the lien.
Action Steps
The best contacts and resources to help you get it done
Check what's allowed by statute in your state
Lien laws vary from state to state, with some state laws more convoluted than others.
I recommend: Tradition Software Inc. links to lien laws by state.
Prepare your paperwork accurately
Software smoothes the way to writing lien forms and notices.
I recommend: Accurate Lien & Contractor Assistance Inc. offers an interactive Web site that lets customers nationwide prepare, track and view preliminary notices.
PreLien2Lien from Tradition Software contains notices and forms specific to all states; it can be downloaded and is also available for a two-day demonstration.
Seek legal advice when you have questions
Lawyers specializing in construction law and liens can help you to navigate statutory liens in states where the process is complex.
I recommend: See a list of
construction lawyers listed by state. The
American Bar Association also helps you find legal assistance in your state or the state in which you're working.
Tips & Tactics
Helpful advice for making the most of this Guide
- A lien secures your interest in the property; if the owner sells, you're entitled to proceeds that pay what you're owed.
- An enormous variety of statutory liens exist, depending on the state. There are landlord's, artisan's, vendor's and warehouseman's liens, to name a few.
- Mechanic's or construction liens do not attach to the owner's personal property.
- Remember: If you win a lien judgment, you'll still have to collect it.
The official source of Filing a Statutory Lien is the Lien Law page at Business.com
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