Construction Frequently
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Preliminary Notice FAQ

A North Carolina preliminary notice is a letter sent by a contractor or supplier to the property owner at the start of a construction project. In many states, a preliminary notice is required to be sent in order to secure the right to lien.

Yes, a preliminary notice, called a notice to lien agent in North Carolina, is required.

 

However, a lien agent, or a title insurance company, is not required for construction projects where the original building permit is less than $30,000 or a single-family, owner-occupied dwelling.⁴

The notice to lien agent must be sent within 15 days of the first day of providing labor or materials.⁵

Send the North Carolina preliminary notice to the lien agent, who is designated by the property owner. 

Intent To File FAQ

A North Carolina notice of intent to lien is sent before the filing of a mechanics lien becomes necessary. Although only a number of states require that this notice be sent, many construction participants send a notice of intent to lien as an uncostly way to have payments for invoices settled.

No, a North Carolina notice of intent to lien is not required. But you may send one as a reminder of outstanding payment.

You may send a North Carolina notice of intent to lien before filing a mechanics lien.

You can send a North Carolina notice of intent to lien to the property owner and/or general contractor.

Not sending a North Carolina notice of intent to lien will not have a bearing on your lien claim since it is not required.

Mechanics Lien FAQ

A North Carolina mechanics lien is an effective tool that helps make sure you will be paid for the construction materials and/or labor you supplied. It is a legal claim that guarantees payment for contractors.

 

This means that if you file a valid mechanics lien on a project you worked on in North Carolina and weren’t paid for your work, you have the right to enforce the lien through a lawsuit. This enforcement action can either prompt the client to settle or force the sale of the property. The proceeds of the sale will be used to settle your unpaid bill.

With a North Carolina mechanics lien, you have an interest in the improved property. When a mechanics lien is filed on the property you worked on, the property becomes collateral for uncollected payments.

The following are the parties that may file a mechanics lien against a property in North Carolina¹:

  • A party that contracts directly with the property owner
  • The first-tier sub, with all required steps followed
  • The first, second or third-tier sub, with all requirements for a claim satisfied, and the owner pays the general contractor and does not withhold the liened amount
  • The second or third-tier sub and supplier through subrogation of the general contractor’s lien even as the first-tier sub has been paid, when the owner has not paid the general contractor and the general contractor has lien rights

 

Notes:

  • Subcontractors are entitled to a lien claim against funds that are owed to the party that hired them and may be subrogated to that party’s claim.
  • Parties that are below the second-tier sub may not be subrogated to the interest of those above them.
  • A party may not be entitled to a lien claim when no money is owed to the higher-tier party at the time of claiming.

A North Carolina mechanics lien should be sent within 120 days after last providing labor or materials and enforced within 180 days after last providing labor or materials.²

A claimant has 180 days after last furnishing materials or labor to enforce a lien.³ The mechanics lien expires after this period.

File a copy of your North Carolina mechanics lien in the Office of the Clerk of Superior Court in the county where the project is located.

 

Do not forget to serve the owner a copy of your mechanics lien.

 

If you are a subcontractor, you must also serve a copy of the lien claim on the general contractor.

North Carolina requires the following pieces of information to appear on the mechanics lien form: 

 

  • The name and address of the claimant

 

  • The name and address of the owner of the property 

 

  • A description of the property subject to the lien

 

  • The name and address of the person the claimant contracted with

 

  • Date of first supplying labor or materials

 

  • Date of last supplying labor or materials

 

  • A statement describing the materials or labor provided

Yes, you can file a North Carolina mechanics lien even if you don’t have a license for the work you did. But it is always best to engage only in work where you have the license for.

North Carolina does not have legislatively designed lien waiver forms. You may use any lien waiver form, but be careful when using or signing one since such forms are not regulated in the state.

North Carolina has no specific requirements when it comes to releasing a mechanics lien. But one the claim has been satisfied, it’s expected that the lien will be released in a timely manner.

Pay if paid and pay when paid clauses are not enforceable in North Carolina. Payment by the owner to a contractor is not a requirement in paying the subcontractor.

References:

https://www.ncleg.gov/

North Carolina Construction Lien Law

¹ North Carolina Construction Lien Law Section 44-A8

² North Carolina Construction Lien Law Section 44-A12

³ North Carolina Construction Lien Law Section 44-A13

North Carolina Construction Lien Law Section 44-A11.1

North Carolina Construction Lien Law Section 44-A11.2

Handle.com provides answers to Frequently Asked Questions (FAQs) to contractors and others who are seeking information regarding preliminary notices, intent to file, mechanics lien, and other construction questions. These are provided for informational purposes only, and we cannot provide any kind of advice, explanation, opinion, or recommendation about possible legal rights, remedies, defenses, options, selection of forms or strategies.