When contractors or suppliers aren’t paid for work on a New York construction project, they have the option to file a mechanics lien to ensure they receive payment. A mechanics lien grants the unpaid party a legal claim on the property.
Understanding the legal and procedural aspects of obtaining loans for property improvement is crucial, including the documentation and filing requirements for a building loan contract.
At CRM Lien Services, we specialize in ensuring that you get paid quickly and reliably. We can prepare and file mechanics liens for you, taking into account New York construction lien law and state-specific rules and regulations, including the need for an adequate and ascertainable description of the real estate.
This guide outlines the essential rules, requirements, and deadlines for filing a mechanics lien New York.
Key Takeaways
- Eligibility for Mechanics Lien in New York: Contractors, subcontractors, material suppliers, and others involved in property improvements can file a lien, but suppliers to suppliers cannot.
- Deadlines Matter: Mechanics liens must be filed within 8 months of project completion or 4 months for single-family homes. Specific extensions apply for unpaid retainage.
- Notarization and Proper Filing: A mechanics lien in New York requires notarization and must be filed in the county where the work was performed, adhering to local rules.
What is a Mechanic’s Lien in New York?
A mechanic’s lien New York is a powerful tool that provides contractors, subcontractors, and suppliers with a security interest in a property. When a notice of lien is filed with the county clerk’s office, it creates a legal claim against the property for payment of work performed or materials furnished.
Governed by the New York Lien Law, this mechanism ensures that those contributing to a construction project can secure payment for their efforts. The claimant gains significant leverage by establishing a lien, as the property cannot be sold or refinanced without addressing the lien.
Who Is Eligible to File a New York Mechanics Lien?
In New York, the following groups are eligible to file a mechanics lien: general contractors, subcontractors, material suppliers, equipment rental companies, laborers, design experts, and landscape gardeners involved in enhancing real property.
Except for suppliers, a claimant’s position on the project does not affect their mechanics lien rights. However, suppliers who provide materials to other suppliers cannot file a mechanics lien in New York. Additionally, for certain projects, claimants may need to file a public improvement lien, which has specific procedural requirements and legal ramifications.
Is a Written Contract Necessary to File a Mechanics Lien in New York?
No, a written contract is generally unnecessary to file a mechanics lien in New York. However, contracts related to “home improvement” projects in NY must be in writing, which could limit the claimant’s ability to enforce a lien claim if not followed.
Can an Unlicensed Contractor File a Mechanics Lien in New York?
No, a claimant must hold the proper license to file a mechanics lien in New York City if the work being performed legally requires a license.
What Is the Deadline for Filing a Mechanics Lien in New York?
In general, a mechanics lien in New York can be filed at any point during the project but must be submitted no later than 8 months after the contract’s completion or the final furnishing of labor or materials.
For single-family homes, the deadline is reduced to 4 months from the completion of the contract or the last date of work or materials supplied.
These deadlines can only be extended if additional lienable work is completed.
For unpaid retainage, a lien can be filed within 90 days after the retainage payment becomes due.
What Information Must Be Included in a New York Mechanics Lien?
A New York Notice of Lien is regulated by NY Lien Law §9 and must include the following details:
- The claimant’s name and address (if a partnership or corporation, include the business address, partner names, principal place of business, or, for a foreign corporation, the address of its state attorney or in-state business location);
- The property owner’s name, address, and interest in the property;
- The name and address of the party who hired the claimant;
- A description of the labor or materials provided;
- The total amount being claimed for the lien;
- The first and last dates that labor or materials were provided;
- A description of the property, noting if it is a single-family home or not; and
- Information about building loan contracts and their relevance to the lien, including how they relate to mechanics’ liens, mortgages, and the priority of claims against the property.
Does a New York Mechanics Lien Require Notarization?
Yes, under New York law, a mechanics lien must be notarized to be considered valid and eligible for recording.
Where Should a New York Mechanics Lien Be Filed and Recorded with the County Clerk?
Mechanics lien claims in New York must be filed with the county recorder’s office. To ensure your mechanics lien is valid, it must be recorded in the specific county where the work took place. Each New York county has its own set of guidelines and requirements.
Can a Mechanics Lien Be Filed on a New York Condominium?
A mechanics lien can be filed on individual units. However, if the work is done in common areas, contractors are not permitted to file a lien against the entire building unless all individual unit owners have unanimously approved the work.
Is a New York Preliminary Notice Required?
No, New York does not require a preliminary notice, as it is a non-notice state. Generally, construction parties are not obligated to send any notice to protect their mechanics lien rights.
However, providing a preliminary notice can still be beneficial, as it increases project visibility, encourages communication, and may help facilitate timely payments.
Searching for Existing Liens
Before filing a mechanic’s lien, it’s crucial to thoroughly search the existing liens on the property. This can be done by examining the county clerk’s records or utilizing online databases such as ACRIS. Identifying existing liens is essential as it helps determine the priority of your lien and reveals any potential issues with the property’s title.
Knowing the lien landscape can also inform your strategy, ensuring that your mechanic’s lien is filed correctly and stands a better chance of securing payment.
How Long is a Mechanic’s Lien Enforceable?
In New York, a mechanic’s lien is generally enforceable for one year from the date of filing. This period can be extended for an additional year by filing an extension with the county clerk’s office. If the lien is not extended, it will expire, and the contractor or supplier will lose their security interest in the property.
Keeping track of the lien’s expiration date is vital to ensure that it is either extended or enforced before it expires, thereby maintaining your right to secure payment for your work or materials.
Discharging a Mechanic’s Lien
A mechanic’s lien can be discharged through several methods:
- Payment of the Amount Owed: The most straightforward way to discharge a lien is for the property owner to pay the amount owed to the contractor or supplier.
- Filing a Bond: The property owner can also discharge the lien by filing a bond with the county clerk’s office. This bond acts as a substitute for the lien, ensuring that the claimant can still seek payment through the bond.
- Court Order: In some cases, a court may order the discharge of a lien if it is found to be invalid or if the contractor or supplier has been paid in full. This legal route can provide a definitive resolution to disputes over the lien’s validity.
Foreclosure of a Mechanic’s Lien
If a mechanic’s lien is not discharged, the contractor or supplier has the option to foreclose on the lien, forcing the sale of the property to secure payment. Foreclosure is a complex legal process that involves filing a lawsuit and obtaining a court order. Given its complexity and potential costs, seeking legal counsel before pursuing foreclosure is advisable.
This process underscores the importance of the mechanic’s lien as a powerful tool for ensuring payment but also highlights the need for careful legal navigation to achieve a successful outcome.
Step-by-Step Guide: How to File a Mechanics Lien in New York?
If you’re looking to file a mechanics lien on a construction project in New York, this guide will walk you through the process. However, before proceeding, it’s essential to be aware of the specific timing and other requirements that must be met to file a valid mechanics lien.
Payment issues are a frequent challenge in the construction industry, with slow or non-payment occurring all too often. Thankfully, contractors and suppliers in all 50 states, including New York, can use mechanics liens to address these payment problems. Below are the steps to file a mechanics lien in New York.
Steps to Filing a New York Mechanics Lien:
1. Complete the NY Mechanics Lien Form: New York law requires the use of a specific lien form when submitting a mechanics lien. Make sure the form meets all state regulations and is completed accurately. A free, state-compliant NY mechanics lien form is available for download.
2. Serve a Copy of the Lien on the Property Owner: You must provide notice to the property owner by serving a copy of the lien. This can be done 5 days before or up to 30 days after filing the lien. Failure to serve the notice will invalidate your lien.
3. Record the Lien with the County Clerk: File the lien in the appropriate county where the project is located. This can be done either by mail, in-person, or through electronic filing if the county allows it.
4. Submit an Affidavit of Service: After serving the property owner, you must file an Affidavit of Service with the county clerk’s office within 35 days of the lien filing.
Mechanics Lien Filing Process Breakdown:
Step 1: Complete the Mechanics Lien Form
It’s crucial to use the correct mechanics lien form that complies with New York state law. Here’s a breakdown of the information required:
- Claimant’s Information: This includes your name and address. If you’re a partnership or corporation, include business addresses, partner names, or principal office details. If you’re a foreign corporation, provide your NY attorney’s contact information.
- Property Owner Information: Ensure the correct property owner is listed, especially if there are multiple owners.
- Hiring Party Information: Include details of the party who hired you.
- Description of Labor or Materials Provided: List the services or supplies you contributed to the project.
- Lien Amount: Only claim the unpaid amount for your labor or materials—nothing more.
- Dates of Work: Provide the first and last dates you worked on or supplied materials for the project.
- Property Description: A simple address will suffice unless the project is in New York City, where you’ll need the block and lot number.
- Signature and Notarization: Make sure to have the lien form notarized before signing.
Step 2: Serve a Copy of the Lien
A copy of the lien must be served on the property owner within the appropriate time frame. You can serve the premilinary notice in various ways, including in person, by certified mail, or by posting it on the property.
Step 3: File the Mechanics Lien
File the mechanic’s liens with the county clerk where the property is located. Be sure to meet the required deadlines:
- For general projects, the lien must be filed within 8 months after the last date of work or contract completion.
- For single-family homes, the deadline is reduced to 4 months.
Step 4: Submit the Affidavit of Service
After serving the lien, you must file an Affidavit of Service with the county clerk to confirm notice was provided.
After Filing: Next Steps
If the lien doesn’t result in payment, you may need to pursue a foreclosure action to enforce the lien. New York mechanics liens are generally valid for one year. However, before resorting to foreclosure, you can issue a Notice of Intent to Foreclosure to prompt payment.
If more time is needed, New York allows lienholders to extend the enforcement deadline by filing an extension form within one year of the lien filing.
If you’ve received payment, you can release the lien by filing a Lien Release Form with the county clerk where the lien was initially filed.
By following these steps carefully, you’ll ensure your New York mechanics lien is filed correctly and help secure payment for your work.
Get in Touch
In conclusion, filing a mechanics lien in New York can be an effective way for contractors and suppliers to secure payment for their work. By following the proper steps and adhering to state-specific requirements, such as timely filing and notarization, you can protect your payment rights.
At CRM Lien Services, we have been serving customers across the country with required reference documentation for lien claims since 1986. We assist property owners in navigating the mechanics lien process, informing them about their rights and responsibilities, including providing notices, securing payment, and releasing mechanic’s liens.
We have a wealth of expertise, are licensed and insured, and have a team of highly knowledgeable document processors. If you’re looking for a straightforward process for filing a mechanics lien, give us a call or shoot us an email.
