Wednesday, May 5, 2010

Florida Mechanics Lien Filing "How To"

Florida mechanics lien statutes provide broad mechanics lien rights to contactors, subcontractors and other persons working on a construction project.  The Florida mechanics liens will provide a great benefit to those who know how to use them.

In Florida, liens filed on private property or on funds relating to a public project are known as Mechanic’s Liens. When a Florida construction lien is filed with regard to work performed on privately owned property, it attaches to and encumbers the fee simple ownership of property.

Contractors, as well as subcontractors, laborers, certain design professionals, sub-subcontractors and material suppliers can file a lien. If a company supplies material to a material supplier, they are not eligible to file a lien claim. Only those who have a direct contract with the owner can file a lien if the total price for the improvement is $2,500.00 or less.

In some cases, in order to file a Florida mechanics lien claim, prerequisites must first be met.  Depending on the claimant’s status, a Florida pre-lien notice may be required.  Subcontractors and sub-subcontractors, including materialmen and suppliers who do not have a contract with the owner, are required to provide a Notice to Owner within the earliest of the following periods: within 45 days of commencing work or providing services for the Project or before the date of the owner’s final payment to the contractor who furnished an affidavit stating that all potential lien claimants have been paid.

In order to file a Florida mechanics lien claim, the filing must be effectuated within a certain time period.  A Florida claim of lien must be filed within 90 days of the last work performed on the project for it to be effective.

Florida does not require that mechanics lien claimants have a written contract to perform the work.  Oral contracts are sufficient if you have sufficient documentation to show the existence of an agreement or that you performed the work for which you are liening.

Florida mechanics liens help you get paid because, on a private project, the Florida mechanics’ lien places an encumbrance on the property that makes it difficult to resell or re-finance the property without first removing the lien.

In Florida, another way to ensure payment is to file a Stop Notice.  A Stop Notice is a notification that has the ability to enhance the effectiveness of a mechanic’s lien. A Stop Notice, or a notice to withhold funds, is sent to the company that is financing or funding the construction funds for a project. Once that company receives the Stop Notice, that company has notice that it should withhold sufficient money to satisfy the stop notice claim. The purpose of the Stop Notice is to provide the lender, financiers or funders of the construction project notice that there is money owed to a contractor, subcontractor or supplier so that an inquiry can be made as to why that money is not being paid.

Finally, if a payment bond has been posted on the project, filing a bond claim can be very effective in obtaining payment.  Bond claims can only be filed on a project where the owner, contractor or subcontractor has obtained a payment bond to ensure that every contractor receives payment for the work performed on the Project.  The payment bonds issued by sureties for construction projects have specific timing requirements, but most require claimants to submit claims against the bond within sixty to ninety days from the claimants’ last date of work.  Bond claims are as or more effective than a lien claim because the payment bond acts as a guarantee that payment will be made for work properly completed.

On Florida public projects, filing bond claims and stop notices are the most effective way to ensure that you will be paid for the work performed.

For more information on filing a Florida Construction Lien, a Florida Mechanics Lien, a Florida Stop Notice, a Florida Bond Claim, or a Florida pre-lien notice, please visit http://www.lienitnow.com/Florida-faq.asp.

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