What is a mechanic’s lien?

On Behalf of | Aug 28, 2021 | Firm News

As a contractor, you do work for a client and expect prompt payment according to the terms of your agreement. If a client fails to pay you, the law gives you an option to collect your money and hold the client responsible.

According to the Arizona State Legislature, you can get a lien against the client’s property for the money owed to you. The law refers to this as a mechanic’s lien.

How it works

A mechanic’s lien is available to you as a contractor or subcontractor. If you supply materials or lease equipment, you also have the right to a lien. You will need to file for a lien in court, but you first must provide the client with a notice.

You must give the client a preliminary notice within 20 days of completing the job. You will then have 120 days to file for the lien. You must file within the timeline or you will lose the ability to get a lien.

How it helps

Once granted, the lien will last for six months. You will have to attempt to collect during that time. The court will not extend the expiration date. If you do not collect, the lien expires and you cannot enforce it.

You should understand collection is your responsibility. The court will not act as a collection agent. It is imperative before filing a lien that you have a collection plan in place. You do not want to waste the time and money on the lien without being prepared to collect it.

A mechanic’s lien can give you the chance to recoup money a client refuses to pay to you for work you have done. It is your legal ability to collect the money using the client’s property.