A preliminary lien notice is a document that notifies a homeowner and general contractor that a person or company intends to file for a lien on the owner’s property. It is required when a lien applicant does not have a direct contractual agreement with a homeowner. The notice must contain specific information and be served properly within a specified time frame. After providing the notice, the lien applicant may proceed to file an effective lien on the property.
A preliminary lien notice is a document that notifies a homeowner and general contractor that a person or company intends to file for a lien on the owner’s property, his or her home. The person or company asserting a right to a lien is a lien applicant. A preliminary lien notice is usually required when a lien applicant does not have a direct contractual agreement with a homeowner. In these cases, the lienholders are usually subcontractors or suppliers to a general contractor who is performing services such as building or remodeling a home for the homeowner. A lien, in this case, operates as a lien on the property, meaning that the homeowner will be unable to sell the home without canceling the lien and risk foreclosure on the home to meet the debt payment.
Each jurisdiction will specify what a preliminary lien notice must contain. It should usually describe the property being pledged. It must also contain the name, address and telephone number of the claimant. The preliminary lien notice must also identify the name, address, and telephone number of the general contractor who has entered into an agreement with the lienperson. If there is no general contractor, the lien applicant must identify the person or entity that received the services or supplies.
The applicant for the lien must usually notify the preliminary notice of lien by certified mail, return receipt, hand delivery or fax with verification of receipt. If the lien applicant does not serve the lien notice properly in advance and with the specified contents, a court will likely refuse to enforce the lien. In addition, many jurisdictions require a lien seeker to serve Preliminary Notice of Lien within a specified time frame, typically within 60 days of the provision of the services or supplies. A court will deny the full value of a lien to a plaintiff if the plaintiff fails to meet the deadlines set by law. Timings for each jurisdiction will vary.
After a pledgee provides a preliminary notice of lien, he may proceed to file an effective lien on the property under the terms set forth in his jurisdiction. The lien will typically contain the lien applicant’s claims, the name of the property owner, the name of the general contractor, a statement of the contract, and a description of the property. The claims statement is the amount of money that the homeowner or general contractor must pay the pledger. The applicant for the lien must sign the lien before a notary who swears by the accuracy of the content of the lien. The lien applicant must then file the lien with the clerk of the county where the property is located.
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