The most valuable tool contractors, sub-contractors, and materials suppliers have in the Texas private commercial construction industry is the mechanic’s lien. Under Texas Construction Law, the mechanic’s lien is a legal tool to help you get paid for past due invoices. However, there are numerous requirements to meet for the mechanic’s lien to work. Let’s take a look.
As a subcontractor, sub-subcontractor, or materials supplier on a private commercial construction project in Texas, you can protect your payment rights with a mechanic’s lien. The good news is that if you adhere to the guidelines, a lawyer is not needed to prepare and file the lien. You can protect your payment rights by submitting the right paperwork at the right time. It’s just a matter of staying organized at the start of each project.
In Texas, construction law provides that sending notices of intent to lien are required to retain your lien rights against a property. Although most commonly referred to as a pre-lien notice, this document is also commonly called an Intent of Lien Notice, a Second Month Notice Letter, a Third Month Lien Notice Letter, or simply a Lien Notice Letter. The pre-lien notice letter alerts the general contractor and property owner that a subcontractor, sub-subcontractor, or material supplier has not been paid for work performed.
Although it’s mandatory for subcontractors, sub-subs, and materials suppliers to send pre-lien notice letters to maintain their lien rights, sending a pre-lien notice does not mean you have to file a mechanic’s lien. Often, just sending the pre-lien notice letter is enough to prompt payment and resolve the issue. (Note: General Contractors are not required to send pre-lien notice letters to the property owner prior to filing a lien affidavit.)
Notice requirements – Deadlines & more
There are deadlines for when pre-lien notice letters are due, depending on where you fall in the project’s hierarchy. We have a very extensive table of deadlines for your reference at www.texaseasylien.com.
Additionally, a separate pre-lien notice is due for each month of work completed, and it should detail the amount owed for that month’s work. Following is the information you will need to complete and mail a pre-lien notice letter:
- Project Information: Project owner, name of the project, common address (or legal property description), and county where the project is located.
- For Subcontractors: Name (or company name) and mailing address of the General (Prime) Contractor.
- Sub-subcontractors: You must have the name and include the mailing address of all Subcontractors involved above you in the contract chain.
- Work: Invoice dates, description of the unpaid work performed, and the amount owed for each individual month.
It’s a good idea to start every private commercial construction project with the assumption that you may be paid late or not at all. The Pre-lien notice letters are an inexpensive way to protect your payment rights and avoid costly litigation costs later, whether you end up filing a mechanics lien or not. When you are ready to send a pre-lien notice letter, you must do so via registered or certified mail. Keep the mailing receipts as proof that you mailed within the deadline requirements and to the correct individuals.
Next steps if pre-lien notices do not prompt payment
If the pre-lien notice does not prompt timely payment, it’s time to file a mechanics lien affidavit. The lien affidavit is an official form that must be signed, notarized, and filed in the official property records of the county where the project is located. Next, mail a copy of your lien affidavit to the property owner and general contractor by the 5th business day after filing the lien with the county. If you do not send a copy of the lien to the property owner and general contractor, your lien may be invalid and have no force or effect.
Does filing a lien affidavit require a lawyer?
Fortunately, services like www.texaseasylien.com allow you to file Texas mechanic’s lien documents quickly, safely, and affordably – without an attorney. In the construction lien process, an attorney is only necessary if you have to foreclose on a filed lien affidavit for continued non-payment.
How long does a mechanic’s lien last in Texas?
Typically, filing the lien affidavit usually prompts settlement of the debt before a trial is necessary. A lien filed against the property will cloud the title and make it very difficult for the property owner to do anything further, such as selling the property. A Texas mechanic’s lien against a property will last until the lien filer releases the lien.
More questions about the Texas mechanic’s lien process for private commercial construction projects? We have everything you need to know – and more – at Texas Easy Lien.