Protecting Yourself Against Leins

Posted by Van Purser on Monday, July 12th, 2010 at 3:24pm.

A contractor or vendor who supplies labor or materials to a new or existing home can file a mechanic’s or materialman’s lien if they are not paid for their services. The vendor must file a claim of lien within 90 days after completing their work or supplying materials to the property. Furthermore, the vendor must file a lawsuit to perfect the lien within 365 days after filing the claim of lien. Otherwise, the claim of lien expires and is void.

To prevent a lien from being filed against your property, a homeowner should insist that every vendor supplying labor or materials to the property sign a lien waiver upon receipt of payment. Moreover, if the homeowner engages a contractor to supervise the work, the contractor should sign an Affidavit of Payment upon completion of the project stating that every vendor has been paid for their work. Thus, if a vendor or subcontractor later files a lien against the property, this affidavit will provide a valid defense against said lien.

If a lien is filed against your property, the homeowner has several options. First, the homeowner can simply wait until the lien expires in 365 days after it was filed (assuming the vendor doesn’t file a lawsuit during this time period). Second, if the homeowner wants to sell or refinance the property and cannot wait until the lien expires, they can purchase a bond with the court to remove the lien from the property and allow the sale or refinance to proceed. Third, the homeowner can file a Notice of Contest with the court that would require the vendor who filed the lien to file a lawsuit within 60 days or else the lien expires.

Brent Warren is a partner in the law firm of McLain & Merritt, P.C., a mid-size firm that has been in business over fifty years. He has been practicing law since 1992 and specializes in both residential and commercial real estate. Brent is a graduate of Vanderbilt University School of Law and the University of Kentucky (B.S. Accounting). His clients include real estate agents, loan officers, builders, developers and relocation companies. He lives and works in Alpharetta, Georgia. kbwarren@bellsouth.net

Van Purser and his wife Jeanne are a licensed Real Estate Brokers in Georgia.  Since1984 they successfully purchased and renovated over 400 homes.  Their expertise is in representing Buyers or Sellers as an advocate; which means always ensuring their best interest.  Additionally, they represented hundreds of clients over the years as an Associate Broker with Metro Brokers, RE/Max and now with his own firm.  He and his wife, Jeanne, have been married since 1977.   Van or Jeanne can be reached at 770-623-3313, or by email at vanpurser@vanpurser.com or jeanne@vanpurser.com

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