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What is a contractor's lien and when is it used?

When you have work done on your home, you might not be asked to pay for everything upfront. This doesn't mean that you won't have to pay. Construction companies can file for a contractor's lien on your property if you don't pay for the work that was done.

There are several things that you should know about contractor's liens. Ideally, you should brush up on this before a project starts so that you know your rights and responsibilities.

What does a contractor's lien do?

A contractor's lien is a legal claim to your property that is made when an invoice isn't paid on time. The contractor has to file paperwork with the court to get this to happen. When the lien is filed, the contractor has a claim to your property, but the contractor can't foreclose on the property.

What can be done to prevent a contractor's lien?

The best way to avoid having a contractor's lien filed against your property is to pay the invoice when it is due. If you can't do that, you might be able to work a deal out with the contractor to get an extension on the due date or to work out a payment plan.

What if the work wasn't up to par?

There are legal methods that you can use to get subpar work handled appropriately. This could involve filing a claim against the contractor. Because this is a sticky area of the law, you should make sure that you understand what options you have and what recourse you might face as a result of each action.

Source: FindLaw, "Contractor's Liens," accessed Aug. 14, 2017

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