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Simple English definitions for legal terms
construction lien
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A quick definition of construction lien:
A construction lien is a type of legal claim that contractors can make on a property they have worked on until they are paid for their work. If the property owner doesn't pay, the contractor can take possession of the property. Construction liens are created by law and are often automatic. For example, in Florida, a construction lien is created whenever construction work is done, but the property owner must be notified of the lien.
A more thorough explanation:
A construction lien, also known as a mechanic’s lien, laborer’s lien, or artisan’s lien, is a type of legal claim that contractors can use to secure payment for their work on a property. This lien gives the contractor a security interest in the property until they have been paid for their services. If the property owner fails to pay for the work performed, the contractor can exercise the lien and reclaim the property.
For example, if a contractor builds a new deck for a homeowner and the homeowner fails to pay for the work, the contractor can file a construction lien on the property. This lien would give the contractor the right to reclaim the property if the homeowner continues to refuse payment.
Construction liens are created automatically in some states, such as Florida, whenever construction work is performed. However, the lien-holder is required to notify the property owner of the lien’s existence.