If you are trying to buy or sell a house that has a mechanic lien on the property, it must be taken care of (released by the lien holder) before any change of ownership can take place.
In real estate terms, a mechanic lien, or a construction lien, is a security interest in the title of property. If a subcontractor, architect, plumber, etc. does work on a piece of property and were never paid, they will file a lien in the county where the property is located against the particular property.
One important thing to know about mechanic liens: If you hire a general contractor to do work on your house and the general contractor hired a subcontractor and did not pay him for the job performed, the subcontractor can file a lien against your property and the home owner will be responsible for paying it before it will be released.
Some tips to avoid mechanic liens
- Keep all receipts and paperwork from the contractor
- Get a lien waiver
- Pay with joint checks
- Pay subcontractors yourself
The best defense against a lien on your house is to avoid it at all costs. However, if you find yourself in a situation where you need a lien released, please contact us to help you determine the best course of action for your situation.