What You Should Know About Liens
If you receive a lien notice, take it seriously. Let your contractor know you have received the notice, and find out what arrangements they have made to pay the sender of the notice.
- How to avoid lien problems.
- Who is subject to liens?
- When can a lien be filed against you?
- What can you do if a lien is filed against you?
How to avoid lien problems
Ask your contractor for the disclosure statement that advises you about lien releases. If any supplier of materials, a worker or subcontractor is not paid, a lien may be filed against your property to force you to pay the debt. You could end up paying twice for the same work. Or worse, an unpaid lien could lead to foreclosure on your home. For remodeling projects, you can only be held responsible for the amount left unpaid to the general contractor.
Before your project begins, request that your contractor post a performance bond for the entire cost of your project. This bond will better cover your investment in case the contractor fails to complete the contract as agreed.
If you receive a “notice of intent” to file a lien on your property, ask your general contractor to provide you with the lien release documents from the supplier or subcontractor who has sent this notice. Your contractor is required to provide you with more information about lien release documents if you request it. Do not make further payments to your contractor until this is satisfied.
Before making the final payment on your project, get a signed lien release from all major contractors, subcontractors, and suppliers that worked on your project.
When making payments, make your check payable jointly to both the contractor and the subcontractor or supplier as payees. Once a subcontractor or supplier has received and accepted payment for work performed, the owner of the property has the right to a completed release of lien rights by lien claimants. For additional information, see RCW 60.04.071.
Who is subject to liens?
Anyone who has hired a contractor to build a new home, or are buying a newly built home, is subject to a lien. A lien can also be held against a remodel project or an improvement to your property. However, in this case, the amount of your liability may be limited to the amount you owe your general contractor at the time a lien is filed.
When can a lien be filed against you?
A lien against a consumer must be filed within 90 days of work stoppage, or delivery of materials. Additional information regarding the timeline for filing liens may be found in RCW 60.04.091.
What can you do if a lien is filed against you?
If a lien is filed against you, the best way to protect yourself is to make a check payable to both, the contractor and the lien claimant to get the lien removed [RCW 60.04.151]. Lien claimants are required to mail a copy of the lien to you within 14 days from the time the lien is filed [RCW 60.04.091(2)].