Every property owner who embarks on home building and remodeling looks forward to their dream of home all set to take a new shape. They expect a flurry of activity at start, first with demolition that is followed by the arrival of right materials along with subcontractors ready to work.
Right after this, certified letters requiring their signature arrive in the mail from the subcontractors and suppliers. As they anxiously open it up, it is basically a ‘Preliminary Notice’ which states that someone out there is asserting lien rights against their claimed property – they just panic! But they should not at all. The homeowner here is just alerted to commonly use legal tool that construction that ensures payment for labor, services and materials provided for a home building and remodeling project.
The purpose of sending a Preliminary Notice, which is also called as the ‘20 days Notice’, ‘Pre-Lien’ or ‘Right To Lien’ is to notify the property owner that is the party offering the Preliminary notice does not get paid, then the party has the right to record a Mechanics Lien against the owner’s property. The timeline within which the notice should be sent to the property owner varies from one state to another. Some must be sent to the property owners within 20 days the subcontractor starts working on the project or as the supplier delivers the material. Other states may have the timeline of less than 20 days and some may have up to 90 or even 120 days.
As a general rule, every material supplier and subcontractor furnishing services, labor materials or equipment to the construction project without a direct agreement with the project owner, must provide a Preliminary Notice to the owner if they intend to retain their lien rights. Accuracy is crucial for a valid preliminary notice. These notices should be served by a registered or certified mail or a delivery service, suitable document able as well as signatures must accompany the preliminary notice.
Last but not the least, receiving a preliminary notice does not indicate that someone is filing a Mechanics Lien against you. It merely ensures their right to lien you in case the contractor does not pay them.
It is basically the responsibility of the homeowner who builds or remodel their home must educate themselves about the construction regulations in their state. Understanding lien laws as well as pre-lien rights and learning about how you can protect yourself from Mechanics Lien being filed against you is the key to having a greater control over the construction project and money.