A mechanic’s lien is an ensuring of payment to builders, contractors, and construction companies that repair or build structures. This type of lien also extends to material suppliers and subcontractors and additionally cover building repairs. The lien guarantees that the workmen get paid prior to anyone else in case of a liquidation.
Understanding a Mechanic’s Lien
Mechanic’s liens are usually required to secure construction assistance on a project. The lien stays in effect until the project gets finished and all construction workers have been paid.
From an investing perspective, it is essential to remember that mechanic’s liens commonly have a higher priority than other types of debt. This priority establishes the order of claims in the event of repossession or foreclosure.
The conceptual source of a mechanic’s lien dates back to the US’s early days. The lien was initially developed by Thomas Jefferson to create an estate owner in the new nation. The US had extensive areas of fertile land and a mechanic’s lien assisted people to monetize the land and construct farms. It is referred to as a mechanics lien since construction workers were called mechanics (or individuals that work with their hands) back then.
Mechanic’s Lien Enforcement
A mechanic’s lien can be utilized to handle both unpaid labor and material expenses associated to a construction project.
Each state has their own laws overseeing the specific kinds of expenses that might be included when filing a mechanic’s liens. Additionally, it’s worth considering that there might be time constraints and statutes of limitations when filing a mechanic’s lien based on when the work was carried out or when construction was finished.
This type of lien is also referred to as a materialmen’s lien or an artisan’s lien.
A property owner might feel inclined to resolve a mechanic’s lien sooner than later since a property usually can’t be sold while a lien is active. Any possible purchaser of the property would notice there is an active lien when they carry out a title search. Any recent owner would be held liable for handling liens connected to the property.
Mechanic’s liens are required be separate from machinery or possessory liens. The aforementioned gives the owner the right for filing a claim towards a property or share of real estate. The owner is required to follow due court process and is unable to expel property holders from their property. Machinery liens provide the owner with the right to retain a piece of machinery, like a vehicle, for delinquent dues.
Dar Liens Offers Lien Processing and Filing in Arizona
Dar Liens Offers Processing and Filing of the following types of Liens: Pre-Liens, Notices to Owner, Medical Liens, Construction Liens, Mechanics Liens, HOA Liens, 20 Day Preliminary Lien Notices, and more.
