In general, a mechanics lien is the most powerful tool available for contractors, subcontractors or service providers to collect their rightfully due money.  For instance, the Illinois Mechanics Lien Act affects property owners, lenders, contractors and subcontractors.  In a broader sense, the Act also affects tenants, architects, engineers, property managers, condominium associations, title insurance companies, and individual workers.   Other states have various laws affecting mechanics lien rights and you should consult with a professional company, like Contractor’s Lien Services of Illinois, which will explain your applicable lien rights over the phone.

When a contractor builds or repairs a building or improves a tract of land in any manner, and the owner, builder or developer refuses to pay for the work, the contractor can file a mechanic’s lien against the property, enforce the lien through the legal process and collect on the lien plus all professional fees, costs and attorneys’ fees ( CLSI does not advance court cost or any legal fees for their clients).  If certain notice requirements are met and the lien is properly filed within certain time limits, the contractor can foreclose on the property, sell the property after foreclosure and collect on all monies due. 

At the same time, mechanics lien rights are not automatically enforced without you taking steps mandated by various statutes in your state.  It is important that you have the right paperwork and that you take the proper steps to protect your rights and collect your just and fair compensation.  We can make sure that the proper notices are provided and that you comply with the Illinois Mechanics Lien Act or the mechanics lien in the state where the work was completed.  You should maintain proper contracts, change orders, waivers, work orders, and signed proposals in order to protect your rights.  It is always in your best interests to consult with competent professionals before you enter into contracts. 

You’ve completed the work and you deserve your rightful pay.  Making sure that you comply with the Illinois Mechanics Lien Act, or the lien act in your state, ensures you that you will be paid for the work you’ve done.  At the same time, the proper filing of a mechanic’s lien strikes fear in the hearts of deadbeats, lenders, and title insurance companies, who must pay you or risk losing title to the property or priority of their mortgage.

The Mechanics Lien Act generally allows you to have priority over a prerecorded mortgage.   Illinois law creates an exception to the first in time principal that automatically defeats most other liens and mortgages in the Mechanics Lien Act.  Your lien if properly recorded can have priority over IRS liens and state tax liens.  In fact, in Illinois only the property tax takes priority over your lien.  Again, the importance of a properly filed mechanic’s lien can’t be overemphasized.  Other states have similar laws but you should consult professionals such as Contractor’s Lien Services to determine your rights in these states.

The Illinois Courts have had the good sense to protect your rights in a mechanics lien regardless of any contractual provision that limits or eliminates your right to file such a lien.  The courts have stricken contractual provisions that limit the right to file or enforce a mechanics lien ruling that such provisions are against public policy.  Every contract whether oral or written provides you a silent right to file a mechanics lien. 

Contractor or Sub-Contractor?

The rules for notices and procedures for creating a mechanics lien varies according to the classification of the lien claimant.  In states such as Illinois, the Mechanics Lien Act includes precise definitions for a “Contractor” and for a “Subcontractor”.  It is vitally important to determine whether you are a contractor or a subcontractor in your state.

For simplicity purposes, we can state that a “contractor” is anyone who contracts directly with the owner of the property.  It doesn’t matter if the contractor was building a multi-million dollar commercial building or repairing the siding and gutters on a single family home.   In both instances, if the company doing the work entered into the contract with owner, the company is a “Contractor” entitled to the same mechanics lien rights regardless of the value of the contract.  Of course, it is important that the contractor comply with the statutory procedures for establishing a valid lien.  Contact a professional such as Contractor’s Lien Services of Illinois and learn your rights as soon as you can.

If you provide labor or materials and don’t enter into an agreement with the owner or owner’s agent, in States like Illinois, you are considered a subcontractor pursuant to the Mechanics Lien Act.  Everyone is a subcontractor that isn’t a contractor.  So a subcontractor that deals with another subcontractor remains a subcontractor under the law because there is no provision delineating sub-subcontractors from subcontractors.   

Other states have similar laws and you should consult Contractor’s Liens Services of Illinois to learn your rights.