A construction lien is the most effective tool for ensuring your business gets paid for any labor performed or materials supplied during the upcoming Wisconsin building season. Properly filed construction liens attach to real estate like a mortgage. The holder of a construction lien can use it to foreclose on a property thereby enabling the holder to be paid if there is equity in the real estate. Further, the holder may be paid during a sale or refinance since the buyer or lender will want clear title. Like any tool though, there is a procedure to properly starting and using a construction lien.
The process begins with giving proper notice of your lien rights to the homeowner or building owner. Wisconsin has strict requirements regarding both the language in a Notice of Lien Rights and the time period in which the Notice must be provided to the homeowner or building owner. Prime contractors (a general contractor who will be using subcontractors) must provide a Notice of Lien Rights within ten days after the first labor, services, materials, plans, or specifications are performed, furnished, or obtained. Subcontractors must provide similar Notice within sixty days after the first labor, services, materials, plans, or specifications are performed, furnished, or obtained. General contractors (who will not be using any subcontractors) have no requirement as to when to provide a Notice of Lien Rights, but should follow the ten day rule if there is the possibility of bringing subcontractors on the job. All types of contractors must then serve the homeowner or building owner with a Notice of Intent to File Lien within five months of the last work performed or services provided. Properly noticed and subsequently filed liens have an advantage should a homeowner or building owner file bankruptcy.
A Notice of Lien Rights should not be a concern for homeowners or building owners. They are not a sign of trouble or disagreement. They are merely part of the process required in Wisconsin. Homeowners and building owners should provide all Notices to their lenders. This enables the lender to assist the homeowner or building owner in monitoring payments and outstanding liens.
Because of the construction lien law technicalities regarding timing and language, an attorney should be involved to train and educate contractors and subcontractors on the process. This will ensure their lien rights are protected. An attorney should also be involved at the first sign of dispute. Menn Law Firm attorneys have experience with Wisconsin’s construction lien laws and their implications. Whether assisting builders in the notice and filing processes, resolving disputes regarding construction liens, or litigating cases involving construction and contractors, the attorneys at Menn Law Firm are available to assist both businesses and homeowners alike.
For further information or to schedule an appointment, please email Attorney Bob Duimstra (firstname.lastname@example.org). All of our attorneys may be reached by phone at 920-731-6631 to discuss the legal services you may require.
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