Statute in Michigan for a Mechanic's Lien
If you were contracted in Michigan to build a house, complete remodeling repairs or just upgrade a building's interior systems such as electrical or plumbing, you would expect to be paid for all that work when you were finished. Unfortunately this isn't always the case, and there are times when a building is completed and someone tries to get away with not paying. The legal recourse in this situation is to file a mechanic's lien on all of that hard work you did.
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Mechanic's Lien
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A mechanic's lien is a document that you can file in any state in the United States as a legal recourse when you receive no payment for services rendered. This document, found under M.S.A. 570.1111 in the Michigan state legal code, is a statement of all the work you performed, and it shows the court that you have a claim. Like unpaid taxes, a mechanic's lien on a home can really cloud issues of ownership, and it can lead to other effects if the lien isn't cleared.
Time
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Where Michigan mechanic's liens are concerned, there are several time frames that all persons should keep in mind. A mechanic's lien needs to be filed no later than 90 days after the end of the work that was completed. Additionally, proceedings need to take place no later than one year from the date of the accepted filing. If either of these conditions is violated, the lien becomes invalid.
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Results
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Once a mechanic's lien has been filed, you are guaranteed to be paid, by force if necessary. In cases where selling the property is necessary to raise the money, all of the lien holders must be paid before the property owner gets any of the money from the sale. In some cases, liens will simply transfer to the new owner after a sale, with the new owner's consent, who then assumes the responsibility of paying the liens on the property.
Homeowner Construction Lien Recovery Fund
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In 1982, the Construction Lien Act established the Homeowner Construction Lien Recovery Fund in the state of Michigan. If you are a homeowner, you pay a contractor to get your home built. The contractor is supposed to pay sub-contractors, who get paid by him and do the actual work. However this didn't always happen, and sub-contractors would then put liens on the house they had built, making homeowners pay twice. This act established a state fund that all licensed contractors pay into, and sub-contractors can present their lien request to the fund for payment rather than filing on a homeowner.
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