Bogus Contractor Lien
4 Replies
Ram Gonzales
Investor from San Antonio, Texas
posted about 2 months ago
We have a property that went under contract to sell and during title, they discovered an "affidavit of lien" that was filed by a contractor whom we fired. His lien claim is for work he didn't do. Right now the attorney is telling me that fighting it would take 3 months or so. Anyone know of a faster way to clear it? I've already offered to just pay him off a lower amount but he won't budge, knows it is BS, but is extorting me for the the full amount because he knows I can't sell until it is cleared.
William Joseph
Property Manager from Plantsville, Connecticut
replied about 2 months ago
Wayne Brooks
Real Estate Professional from West Palm Beach, Florida
replied about 2 months ago
Most states have a provision in their lien law that would allow you to “bond off the lien”....placing cash, usually about 125% of the lien amount, in a court account. This takes away the contractor’s leverage.
Also, most states have decent penalties for filing a fraudulent lien. If he’s licensed, a complaint to the licensing board wouldn’t hurt.
Ram Gonzales
Investor from San Antonio, Texas
replied about 2 months ago
@Wayne Brooks That is a brilliant option! Thank you! I called a local bonding company and am looking into the process. I'm pretty irked that my attorney didn't bring up this option. Thank you again!
Wayne Brooks
Real Estate Professional from West Palm Beach, Florida
replied about 2 months ago
@Ram Gonzales You have to verify if this is an option under Your state laws. A bond may or may not be provided for....it may have to be cash.
You can find your state mechanics law statutes online.
Your title company should be familiar with this, if it is allowed there.