How To File a Lien

A mechanic’s liens and judgement liens are two different types of liens that give you a right in or over property as security for a debt.The mechanic’s liens allow contractors to collect money they earned doing work by encumbering the property they worked on until the debt is satisfied.At the conclusion of a lawsuit, a judgment lien can be used to collect a court-awarded judgment.

Step 1: All other options should be exhausted.

A public declaration that someone hasn’t paid for work is a strong legal move.If you want to file a lien before talking to the property owner, try to set up another plan.From the beginning of a job, be clear that you will file a lien if debts are not paid.Washington has forms you can use to notify property owners of your right to file a lien if you aren’t paid.You can advise the property owner of their right to file a liens in your contract for the work.If the property owner agrees to a payment plan, make sure the due date is reasonable and that the plan is in writing.If you complete work on a client’s garage for $2,000, you can work out a payment plan in which your client agrees to pay you $500 a month for the next four months.A lawyer may be able to help you draw up an agreement.Alternative dispute resolution is something you might consider.You and your client share the cost of hiring a neutral mediator to help you work out a mutually agreeable outcome.The process is more efficient and less expensive than filing a lien.There is a list on the website of your local courthouse or state court.Another way to avoid the time and expense of engaging in formal legal processes is to hire a debt collection agency.Debt collections agencies can put pressure on your client without you having to take legal action.Look for a collection agency that specializes in working with people who do the same kind of work you do and that has a good reputation.

Step 2: Make sure you give preliminary notice.

If the debtor doesn’t pay you, most states require you to notify them.You would usually give this notice within the first few weeks of work.If you don’t give preliminary notice, you can lose your right to file a lien.You need to use a specific form in some states.To find out if your state has any specific requirements, check with your local clerk of court’s office.In most states, you have to give preliminary notice when you start work.

Step 3: You should check your state’s deadlines for filing liens.

You only have a brief period of time after you’ve completed the work to file for a lien, and in some states it is as short as 60 days.If you want to preserve this option, you may not have time to exhaust all other options.In Louisiana, you only have 60 days from the day you finish the work to file a lien.You don’t have a lot of time to pursue alternative methods of collection.You have a whole year from when the debt became due in Mississippi.You have plenty of time to discuss other payment options with your client.

Step 4: You should research the property.

To file a liens on property, you need to conduct a title search on the property to make sure your client owns it and get the full legal description from the deed.The process could cost hundreds of dollars.General contractors who file a lien before the deadline have priority over any other liens on the property, even if another mortgage or a competing lien comes first.Even if you filed suit and had the property sold, you wouldn’t recover any money because other liens would take priority over yours.If there are other liens on the property, you should consult an attorney.

Step 5: Take care of your liens.

A one-page document with information about the creditor, the debtor, and the property is called a liens.There are court forms to fill out in most states.California requires a claim of liens form as well as a notice and affidavit.Contact your local clerk of court to learn your state’s requirements.Many counties have strict rules governing the paper size, margins, and style of text, so it’s a good idea to check them out.The office will reject your lien if you don’t follow the rules.The amount of money you are owed, your name and address, the type of work you performed, and the location of the property are all things that are required on a state-by-state basis.If you don’t include all the necessary information, your lien will not be good.Most states require a legal property description such as the one on the deed, not just a street address, for liens to be placed on real property.

Step 6: You have a right to file your liens.

The property recorder’s office or the clerk of court can be used.Make sure you have the right office that accepts mechanic’s liens in your state.The recorder’s office of the county where the property is located is where liens on real property must be filed.Depending on where you file, you can expect to pay between $25 and $50.You may want to deliver it in person since you can file it by mailing it.If you’re close to the deadline, it’s important that you file your paperwork on time.You can find out if something is wrong with your lien if you file in person.

Step 7: Inform all necessary parties.

Most states require you to notify the property owner after you file a lien.Other liens holders are required by some states to be notified as well.It is possible to find out who must be notified when you file the lien.In many cases, the property owner will make arrangements for you.

Step 8: Enforce your liens.

If the debtor still doesn’t pay after a certain amount of time, you have to file a foreclosure lawsuit.The property will be sold.Any liens on the property are satisfied by the proceeds of the sale.If you don’t know what your enforcement period is, you should.You have no value after the enforcement period is over.Some states have very short enforcement periods.You only have 90 days to file a lawsuit in California.You should consider hiring an attorney who specializes in foreclosures or mechanic’s liens if you want to file a foreclosure suit.

Step 9: Understand if you’re eligible to file a judgment lien.

After you’ve won a court judgment in a case in civil court, you can only file a judgment lien.You can use the money from the sale of the real or personal property to satisfy the debt you have.Judgement liens don’t guarantee payment of a judgment.Potential buyers are informed that the title of the property is not clear when the liens attach to the debtor’s real or personal property.There’s a chance you won’t get your money until the person decides to sell the property.

Step 10: There are rules for judgment liens in your state.

There are different procedures for getting and maintaining judgment liens.If you don’t know the rules you could cause your lien to expire.Only personal property located in the state where the judgment was obtained can be placed a liens.For a period of time, the liens are only good.If you haven’t been paid within a certain period of time, your lien may be renewed.If the debtor sells or transfers the property, the judgment liens remain on it until they are paid in full.

Step 11: The documents should be drafted.

If you’re eligible to file a judgment lien, you should know what documents you need to submit and what fees will be charged.You can fill out a form in some states.If you want to file a lien on a car or a boat in California, you need to fill out a form and submit it to the California secretary of state.If you wanted to place a lien on real property, you would need to fill out and record an “Abstract of Judgment for Civil and Small Claims” form at the county recorder’s office.A certified copy of your court judgment is required in some states, such as Arizona.You can get a certified copy from the court clerk’s office for a fee.

Step 12: Don’t forget to file your documents.

Where you file your documents depends on where the property is located and if you’re attaching your liens to real or personal property.Each state has its own filing rules and procedures for real and personal property.It is in your best interest to file your documents in person so you know the mechanic’s liens are recorded and you can correct any defects immediately.

Step 13: Wait for the debtor to pay.

Judgement liens don’t guarantee payment of the debt.You have to wait until the property is sold.The debtor will have to satisfy the judgment before the buyer completes her purchase.Most potential buyers want a clear title, not a property that is encumbered with someone else’s debts, if there is no law that requires liens to be cleared before property is sold.If the debtor pays the judgment, you must file a form with the court that acknowledges the satisfaction of the judgement in order to remove the liens.

Step 14: There are other options to recover the debt.

Wage garnishments or bank levies can be used to collect the debt if the debtor still doesn’t pay.To find out more about the options in your state, speak to a collections attorney.