Understanding Mechanic's Liens, Bond Claims, and Other Escalation Documents and How National Lien Services Can Help

What are Mechanic's Liens?

A mechanics lien represents a legal assertion against a residence or any other property, initiated by a contractor or material provider who hasn't been compensated. This claim is affixed to the real estate, granting the unpaid party a stake in the property as collateral. Failure to resolve the claim could result in foreclosure, compelling the property's sale to clear the outstanding debt.

A Mechanic's Lien is just one type of escalation tool contractors may be able to use to get paid. Generally, the type of escalation tool to use is project-specific (dependent on type of property, your role on the project, how you wish to engage with your customer, etc.).

Quick tips

Have your lien related documents ready to go, including:

Original Contract
Open Invoices
Statement of Account (Current AR Report) for the project
Change Orders
Payment Applications
Prior correspondence in your efforts to collect
Name and title of the person legally able to sign documents on behalf of the company

Have an action plan, including:

Know what your time frames are so you don't get caught toward the end of the project
Keep your "Lien Team" in the loop to help partner and adjust with you when you need it
Don't wait too long to get paid! We advise our clients to reach out when emails stop getting responded to, calls stop getting returned
Engage with your internal team – project managers, project admins, and project accountants all need to be in the loop when things are going on that can affect your company's money

Escalations 101

Types of Escalation Documents:

Mechanic's Lien Claim
Claim Against a Bond (Bond Claim)
Notice of Intent to Lien
Lien Release (after you're paid on your lien claim)
Stop Notices
Little Miller Letter

You've done your due diligence, mailed your construction notice on time, managed your change orders and waivers, completed your project and now you're seeing issues with getting your pay applications being processed or paid out. It happens all the time. Many times, it isn't the person you're contracted with that is holding up your money; it may be an owner, developer, or even lender. When you're at the point that you're evaluating your collection avenues, our team of experienced Escalation Professionals are ready to consult with you to help devise a "lien plan" to get you paid as quickly and painlessly as possible.

What We Do

Re-research the project to see if a new lender or owner may be on file for inclusion on the lien (and any pre-lien documents)
Draft the appropriate legal documents for payment
Compile all relevant exhibits
Fully prepare legal document
Once signatures are notarized and received, we will e-file for you if possible – if not, we will help coordinate a courier with you
Mail all recorded documents to related parties within statutory timeframes

Learn About Our Other Services

Preliminary Notices To Owner (Preliens)

Waiver Management done right