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Overview of Florida’s construction lien law

On Behalf of | Nov 8, 2020 | Real Estate Disputes |

Like other states, Florida has what is called a Construction Lien Law. The goal of this law is to ensure those who do work building or improving homes and buildings in this state either get paid or are able to recover some of their costs.

The law itself is complicated and detailed. It includes many deadlines and notice requirements that are important both for contractors and landowners alike.

However, the basic idea behind a construction lien, which also is commonly referred to as a mechanic’s lien, is that a contractor or subcontractor can have a claim on the property for the value of parts and labor similar to how a bank holds a mortgage on a home.

If the contractor does not get paid, then the contractor can legally foreclose the lien.  The end result is the contractor can force the sale of the property and collect from the proceeds of the sale.

Construction liens can impact innocent property owners in Broward County

A big problem with construction liens is that they can take property owners by surprise in several ways.

The reason is that contractors may record and even foreclose on a lien without regard to who owns the property or who is ultimately responsible for not paying for the contractor’s work.

For example, an owner may hire a contractor to perform work, and that contractor may use subcontractors. Even if everything seems fine between the contractor and owner, if the contractor is not paying the subcontractors, then the subcontractors might record a construction lien.

Likewise, a family or business investor may purchase a new or recently improved property only to find that it is subject to a construction lien. The buyer faces the possibility of either paying off the lien or facing foreclosure.

Construction liens may lead to real estate disputes in which would  important for those involved to understand their options.