Mechanic’s lien. Two words no seller wants to hear. After all, you’ve take the time to prepare the property. Including those little updates and some overdue fixes. And, now, you’re just anxious to get through to the closing.
What’s more, you’ve already found another home and it suits you just fine. You’re thinking about what little changes to make so it’s perfect. The buyer’s financing is solid and you’ve received a great offer. The home inspection and appraisal have all come back thumbs up. Now, you’re suddenly taken aback. You’ve been informed there’s a problem. There’s a title defect and the transaction can’t go through until it’s resolved. You’re both confounded and angry but you can’t just ignore the situation. You must deal with it. Otherwise, you can’t sell the house and you’re stuck until you do.
What Florida Law Says about Mechanics’ Liens
Unfortunately, the state of Florida gives fairly broad license to filing a mechanic’s lien. In fact, one can easily be filed by contractors, subcontractors, material suppliers, equipment rental companies, laborers and licensed professionals. All have legal standing to file a lien. What’s more, as the nearby quote points out, there is no requirement for a written contract. Anyone can file a mechanic’s lien, even if the transaction is verbally agreed. So, that means just about anyone can file a mechanic’s lien against a property.
“Generally speaking, contractors, subcontractors, material suppliers, equipment rental companies, laborers and professionals have lien rights in Florida. Florida does not require that you have a written contract to file a mechanics lien, so contracts can be oral, written, express or implied.” —The Lien and Credit Journal
But, there is a serious stipulation. If you read the nearby quote again carefully, you’ll see that it does require the filer to actually be licensed. What’s more, there are other individuals which do not have the right to file a mechanic’s lien in the state of Florida. Those include sub-subcontractors, supplier to suppliers, suppliers to subcontractors, and maintenance workers. Now, this doesn’t mean one of these individuals can’t file a lien. It does mean that said lien will not be legally enforceable.
Ways to Deal with a Mechanic’s Lien
Okay, so you now know there’s a mechanic’s lien against the property you’re selling. The bad news is, you’ll have to deal with it so you can sell the house. The good news is there are a few different solutions. Here are the ways to deal with a mechanic’s lien so you can move on:
- Carefully read the document. The first thing you need to do is get a copy of the lien. Read through it carefully and pay close attention to who filed it. If it was filed by someone who doesn’t have a legal right, you’re in luck. Also, if the underlying reason isn’t true, that’s good news, as well. Take it to a legal professional to learn more.
- Attempt to settle the matter. If the matter is legitimate, then you might consider trying to settle the matter with the person who filed the lien. Try to negotiate an arrangement with the licensed individual or company so the lien is withdrawn.
- Pay the full amount and move on. Of course, another option is to just pay the lien off so there is no more encumbrance against the property. While this certainly isn’t the most appealing option, it will resolve the problem and you’ll be free to sell the home.
If you’re going to sell your home in the near future and buy a new house, please don’t hesitate to phone me at 407-616-7286, I’ll be happy to speak with you.