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How to deal with a mechanic’s lien

On Behalf of | May 4, 2023 | Construction Disputes

A mechanic’s lien is a tactic contractors in Texas can employ on selected occasions. This is one of the tools that they can use to ensure timely payment. The idea is to give them a security interest in the property they have been hired to work on. If the owner fails to pay, they get their money back by foreclosing.

How a mechanic’s lien works

A mechanic’s lien is one of the most common tools that a contractor can use to pursue construction litigation. This is particularly relevant when serious payment issues have yet to be resolved. They normally begin the process by filing a Notice of Lien at the county clerk’s office where the project is taking place.

For a mechanic’s lien to be considered actionable, it must include the following information:

  • The name of the person or company filing the lien
  • What services the contractor has provided
  • The amount of money that was agreed upon as payment for the services that were provided
  • The date that this payment was due

How to contest a mechanic’s lien

There are several ways that you can contest a mechanic’s lien. You may be able to prove that the contractor never actually worked on your property. You may also be able to show that you have already paid the full amount that was demanded. If either strategy proves successful, you can get the court to remove the lien from the public record.

It may be possible to sit down with the contractor and negotiate a settlement that will satisfy the needs of both parties. This is normally done through the process of mediation. If successful, you can move forward with no further issues.

If negotiation fails, you may be able to resolve the issue by getting a loan to cover the amount of the lien. This can be done through a title company to wipe out the debt and proceed to the completion of your project.