Alabama construction companies can invest hundreds of hours of manpower and thousands of dollars in supplies in a single project, only to have the client indefinitely delay making the final payment. It is common practice for those hiring construction companies to only make a deposit at first and then pay the balance due after inspecting the work performed and confirming it complies with the terms of the contract.
However, some homeowners will refuse to pay the final invoice due and will leave your company in a bad financial situation. They might claim that you didn’t adhere to the contract or that you left work unfinished. On the other hand, they might just ignore your invoices and your collections phone calls.
If you cannot get them to pay their invoice in full voluntarily, then you may need to assert your right to file a mechanic’s lien. Such liens are a powerful tool for service providers like construction or renovation companies still owed money by their clients.
There are limitations on construction-related liens
Alabama has specific rules about securing a mechanic’s lien. Typically, you can only request a lien against private property where your company performed work or supplied materials.
Additionally, you have to act quickly. The courts expect you to file your lean request within 6 months of the date when the full amount for the work came due. If you delay too much to give the client the benefit of the doubt, you may lose your opportunity to obtain a lien that will force them to repay you when they refinance or transfer the property.
Mechanic’s liens are a crucial protection
You shouldn’t have to gamble on getting paid. When a client doesn’t follow through with their obligation to pay you, seeking a lien will be an efficient and effective way to get the money you deserve for the work that you have already performed. Some companies worry that seeking mechanic’s liens will hurt their reputations, but it will likely only deter clients who would have tried to avoid paying them anyway.
Taking the necessary steps to resolve a construction dispute involving an unpaid invoice will help you protect your company and its financial solvency.