Businesses providing construction, repair or home improvement services have to compete with many other companies. One of the ways that they attract consumers is by offering competitive pricing. Being flexible regarding payment arrangements can also help attract more prospective clients.
Frequently, property owners only pay a portion of the estimated total project costs initially. They may then cover the balance after the successful completion of the project. They retain funds as a way of ensuring that the professional completes the project and that they the standards set in the contract.
If property owners do not pay in full, the parties affected by their financial non-compliance can potentially request a construction lien. Any of the three parties below can theoretically ask for a lien against real property due to unpaid invoices.
1. Construction firms
Companies that offer roofing, kitchen remodeling or siding repair services can request a lien when a property owner does not pay in full for the services provided. Proof of the services rendered and information about any payments received can help a construction company validate its claim that it deserves a construction lien due to the client’s non-payment.
2. Subcontractors
Construction companies do not necessarily handle every aspect of a project in-house. In many cases, they hire smaller businesses or independent professionals as subcontractors for certain parts of a project.
Those professionals may then have grounds to request a lien if they do not receive payment in full from the business. Even in cases where homeowners pay the construction firm in full, subcontractors who worked for a company and did not receive payment could potentially request a construction lien.
3. Materialmen
Construction projects often require skilled work and arduous blue-collar labor. They also require a variety of different types of construction materials.
The businesses and professionals who deliver construction materials can also request liens if they do not receive payment in full. As is the case with subcontractors, parties providing construction materials can pursue a lien regardless of whether they have an agreement with the property owner or with the construction company that the property owner hired.
Both property owners and those employed in the construction sector may benefit from learning more about construction liens and construction litigation. Seeking a lien against real property is a common response to unpaid invoices for services, labor or materials during a construction project.
