Are you coping with difficulties in charging money for your contractor’s services? A myriad of general contractors, subcontractors, and material suppliers don’t get paid after the completion of home improvement projects. Instead of filing for breach of contract, these professionals are recommended to file a mechanic’s lien.
Besides gaining the necessary compensation, such a claim is detrimental for the property title of the owner, making it look unattractive when put up for sale. Potential claimants are expected to take numerous considerations into account before filing for such a claim by studying the lien’s law of their states.
The following guide to the mechanic’s lien is useful for individuals recording a claim in Texas.
Eligibility criteria in Texas
The state of Texas considers three categories of professionals qualified to file a mechanic’s lien, those being design professionals, fabricators of materials, as well as individuals involved in property improvement. Anyhow, even if a person falls under one of these categories, he/she has to abide by the preliminary notice requirements, which are infamous for being too confusing.
Moreover, potential claimants are supposed to be extremely attentive when it comes to homestead properties, which refer to properties inhabited by the owners. In such scenarios, one has to take extra steps in order to be considered eligible.
For instance, the homeowner and the contractor are obliged to sign a written contract prior to the commencement of the project. In cases where the owner is married, both spouses are required to sign the contract, regardless of which spouse owns the property. In order for the contract to be considered valid, it has to be filed in the county where the homestead is.
After handling the above-mentioned notice, it’s paramount for claimants to have enough time left to meet the filing requirements. Apart from the requirements related to liens and preliminary notices in Texas, claimants are expected to have their lien recorded within the deadline. The amount of time to file a claim is generally determined by whether the person is involved in a residential or a non-residential project.
The mechanic’s lien form
The lien form in the state of Texas is known under the name Affidavit of Lien, which is crucial to remember when searching for such a form online. The form for contractors differs from the document for subcontractors and suppliers, so one has to be attentive when making a choice. In order for the affidavit to be valid, it has to contain the required content, stated by the Texas mechanic’s lien statute.
One of the most crucial considerations when filing out the affidavit is the signature block, found at the bottom of the document. Unless the claimant signs the document or another individual does it on its behalf, the lien would be considered invalid.
Moreover, the state of Texas is specific in the requirements related to the lien amount, specifying which costs are allowed to be included in the amount of the claim and which aren’t supposed to be. For instance, the expenses related to the labor and provided materials, as well as any other costs concerning this aspect of the project, should be included in this amount.
In contrast, the filing costs, attorney expenses, and interest should not be calculated in the amount of the claim. The same goes for any kind of damages that result from a breach of contract. Click here to learn more about the various types of liens.
Furthermore, claimants are advised to pay attention to the document section that requires the name and address of the property owner. In Texas, individuals filing such a claim are obliged to identify the name and address of the original contractor, as well as the name and address of the person who hired their services.
Another important aspect claimant is required to fill out in the affidavit is a description of the materials and work involved in the job. Although the description is supposed to be general, claimants have to categorize the labor and materials by month. Also, it is paramount for the person filing the claim to provide the right property description in order for the affidavit to be valid.
In addition, claimants are expected to provide a list of notices sent to the owners and other potential parties. The list is supposed to include the date on which the copy was delivered, as well as the delivery method that was used.
Lien claimants in Texas are provided with the opportunity to add relevant attachments to the claim so as to make it stronger. For example, they are encouraged to add the invoices included in the project, along with a copy of the construction contract, signed before the beginning of the project. Visit the following link, https://en.wikipedia.org/wiki/Construction_contract, to check out the main types and features of construction contracts.
Filing and post-filing procedure
When filing such a claim in Texas, one is advised to record its mechanic lien in a recording office, whose location matches that of the property. Given the extensive number of such offices in Texas, the claimant has to select the right type of office, situated in the right county.
Once the claim gets filed, claimants are obliged to send a notice of claim to the owner of the property as well as the general contractor in case you are a subcontractor or a material supplier. This notice has to be sent no later than five days since the claim has been filed via certified mail.
Given the temporary nature of the mechanic’s liens, one is supposed to be familiar with the deadline for foreclosure. In Texas, the claim remains effective in the course of two years following the filing and one year after the project is completed. Keep in mind that the deadline for residential projects is no longer than a year, whereas non-residential projects have longer deadlines.
In order for your mechanic’s lien to be considered valid, make sure you follow the required filing procedure and miss no deadlines!