If you’re a contractor, a general contractor, a subcontractor, or even a store or supplier that is involved in a construction or property project, you can guarantee that you’re going to get paid, even if the client isn’t willing to pay.
Most importantly, you have to file a mechanic’s lien in order to do so, as long as you qualify, and securing this right should be one of the first steps you should take as a contractor before you ever sign and start a contract. In this guide, we’re going to discuss the importance of a mechanic’s lien and how you can benefit from getting the right help to obtain one.
How Can You Benefit from a Mechanic’s Lien?
Well, first of all, the main and primary benefit is of course, that you can get paid for the hard work you’ve done, no matter what happens (the project is complete, gets terminated for some reason early, etc.)
Most contractors actually use some of their own business money in order to buy materials for a home project, and because of this, they should be compensated for that. Any repair, demolition, or construction project that happens and is performed for the property owner should get paid for, and a mechanic’s lien is a way to secure that on a publicly recorded legal document.
What About Filing a Lawsuit?
Filing a mechanic’s lien is actually better than a lawsuit because it guarantees your pay. At the same time, it looks a lot more professional on your record if you’re an unpaid worker, and because a lien is set to a certain deadline, you can use it as a pre-requisite to a lawsuit and this scares some property owners to pay off the lien instead of getting sued.
Protection from Resale
Another amazing factor, especially with a home renovation, or even a remodeling project (or construction project of a new property), this mechanic’s lien can actually prevent them from selling their home right out from under you, basically securing all of the property that you busted your hind end working on.
In this regard, when you file a lien, you’re basically telling your clients and everyone involved in the project that you’re going to make sure you get paid, even if you have to pursue the law in order to do so. Because of this, you can actually get more clients to pay on their projected due dates and not be late.
A mechanic’s lien is sometimes confusing to fill out, unfortunately. Because of this, though, there are numerous companies in a place like BICA, an office dedicated to help contractors all across America get paid, as well as provide financial consultation to help them file all of the paperwork that’s necessary in order to get paid. They’ve been in operation for years, and have landed over $480 billion in secured funding for contractors, and have helped to file over 2 million notices and over a 100,000 lien releases since they started.