Originally Posted On: https://crmlsi.com/mechanics-lien-illinois/

 

Mechanics Lien Illinois Guide

Navigating the complexities of construction projects can be a daunting task, especially when it comes to securing payments for work performed or materials supplied. The process can often become complicated, with delayed payments or disputes over invoices. This is where a mechanics lien comes into play, acting as a powerful legal remedy for contractors, subcontractors, and suppliers to secure payment for their services and materials.

If you’re involved in the construction industry in Illinois, understanding the mechanics lien process is essential.

At CRM Lien Services, we specialize in ensuring that you get paid quickly and reliably. We can prepare and file mechanics liens for you, taking into account Illinois state-specific rules and regulations.

In this article, we provide a guide on Mechanics Liens in Illinois, and we answer all the commonly asked questions about how Mechanics Liens work in Illinois.

Key Takeaways

• A mechanics lien in Illinois provides legal security for contractors, subcontractors, and suppliers by placing a claim against a property for unpaid work or materials. This lien ensures that those who contribute to a construction project are compensated, safeguarding their financial interests.
• The mechanics lien process involves serving a preliminary notice within 60 days of starting work, providing a notice of Intent to Lien within 90 days from last supplying materials, labor to services, and then recording the lien with the county recorder’s office within four months of the last work date, and serving the notice of lien on the property owner within ten days. If payment is not received, a foreclosure lawsuit must be filed within two years to enforce the lien. The preliminary notice is only a requirement when working on a single-family owner-occupied residence; in all other cases, the preliminary notice is considered optional.
• CRM Lien Services helps clients navigate the Illinois mechanics lien process by handling all necessary documentation, notices, and filings. This ensures compliance with state-specific regulations, reduces the need for attorney involvement, and secures lien rights efficiently and affordably.

What Is a Mechanics Lien in Illinois?

A Mechanics Lien, also known as a Construction Lien, is a guarantee of payment for builders, contractors, construction firms, material suppliers, or any other stakeholders involved in a construction or property improvement project.

When a party involved in the process is concerned about non-payment for materials or services or is struggling to secure payment, the Mechanics Lien provides the unpaid party a security interest in the property they have worked on. Mechanics liens only attach to real property, such as land, houses, or other buildings, and they are attached to the property’s title.

Mechanics liens provide security and pressure property owners into swiftly settling outstanding debts. According to Illinois law, anyone who improves private property through labor or supplies can file such claims.

General contractors, subcontractors, suppliers—all these lien claimants—can safeguard their financial interests through this process. Understanding and utilizing mechanics liens correctly can help ensure that you are paid for your contributions to a construction project.

How Does a Mechanics Lien Work in Illinois?

In Illinois, the mechanics lien process is designed to ensure that those who contribute to the improvement of real property receive the payment they are owed. Here’s a step-by-step look at how a mechanics lien works in Illinois:

1. Preliminary Notice: Subcontractors and suppliers must provide an initial notice to the property owner within 60 days of commencing work. This notice informs the owner of their involvement and potential lien rights, helping establish a foundation for future claims. This notice is required in Illinois for single-family, owner-occupied residences only.
2. Notice of Intent to Lien: Also known as a Subcontractor’s 90-Day Notice, this notice is required for all private construction jobs as a prerequisite to filing the lien. The notice of intent to lien must be served on the property owner, general contractor and lender within 90 days from last supplying materials, labor or services. It also must be served no later than 10 days prior to recording a claim of lien. The Notice of Intent to Lien informs all key stakeholders, like the owner and general contractor, that there is an unpaid balance and that you have valid lien rights, and that you intend to proceed in filing a lien against the property if you do not receive payment promptly.
3. Filing the Lien: To file a mechanics lien in Illinois, you must record a lien claim with the recorder’s office in the county where the property is located. This filing must occur within four months of the last date you provided labor or materials and at least 10 days after serving the Notice of Intent to Lien. The lien claim should include details such as:
   • The amount owed.
   • A description of the work performed or materials supplied.
   • A legal description of the property.
   • The name of the property owner.
4. Serving Notice to the Owner: After filing the lien, you must serve a copy of the lien claim on the property owner within ten days. This step is critical as it ensures the owner is aware of the lien and can take necessary actions to address the payment issue.
5. Enforcement of the Lien: If payment is still not received, you must enforce the lien by filing a lawsuit to foreclose the lien within two years of the completion of the contract. This legal action can compel the sale of the property to satisfy the debt owed to you.
6. Priority of Liens: Mechanics liens in Illinois take priority based on the date the claimant first provided labor or materials to the project. This means that earlier liens will have precedence over later ones, affecting the distribution of proceeds if the property is sold.
7. Release of Lien: Once the debt is paid, it is the lienholder’s responsibility to file a release of lien with the county recorder’s office. This step clears the lien from the property’s title, allowing the owner to sell or refinance the property without issues.
8. Impact on Property Transactions: A filed mechanics lien becomes a public record and can significantly impact the property owner’s ability to sell or refinance the property. This often provides strong motivation for the owner to settle the debt promptly.

It is essential to know the statutory requirements of lien law in Illinois or to partner with a service like CRM, who are equipped and experienced in Illinois Lien Law. As a quick reference, you can check out our 50 State Guide which will provide you the exact steps required to protect yourself under lien law based on the type of work you are doing and your role on the project. We also recommend reading the Illinois State Statutes on Lien Law, especially if you are doing many different types of construction projects, such as private, public, or residential jobs.

With our assistance at CRM Lien Services, you don’t have to worry about all the nitty-gritty details of Illinois lien law. You can simply provide a few pieces of basic information regarding the job you are working on, and we take care of everything else to make sure your lien rights are secured so you can get paid. We take care of serving the preliminary notice and intent to lien and we also take care of the process of filing the lien with the county recorder’s office.

Additionally, you won’t need to involve an attorney unless or until the lien is enforced in court, which makes our services much more affordable than what a construction attorney would charge. To submit your order for a Mechanics Lien in Illinois, please fill out our Mechanics Lien request form here.

Who Can File a Mechanics Lien in Illinois?

In Illinois, a mechanics lien is a crucial legal tool that helps various parties in a construction project secure payment for their services and materials. Key parties eligible to file a mechanics lien include general contractors, subcontractors, material suppliers, laborers, equipment lessors, and professionals like architects, engineers, and surveyors. Each of these contributors can file a lien if they have not received payment for their work, provided they adhere to specific legal procedures.

To successfully file a mechanics lien, claimants must serve the prerequisite notices such as the preliminary notice and notice of intent to lien, file the lien with the county recorder’s office within four months of completing their work or supplying materials, and include all necessary details in the lien claim. These details should encompass the amount owed, a description of the work or materials, and a legal description of the property. Meeting these requirements ensures that the lien is valid and enforceable.

Filing a mechanics lien correctly establishes a legal claim against the property, compelling the owner to address the outstanding debt. This action places a cloud on the property’s title, often motivating the owner to resolve the payment issue promptly.

If a lien is not filed correctly, it could be rejected by the county recorder’s office or it could also invalidate the lien, and the lien claimant may be required to release the lien without getting paid for the unpaid balance.

On top of support with filing a Mechanics Lien, we also handle preliminary notices and notices of intent to lien. We make the process of securing lien rights simple and straightforward. All you have to do is order a Preliminary Notice on our website and provide a few pieces of information regarding the project you are working on, and then we will do all the work to research, verify, prepare, and serve the notice on your behalf.

What Is a Preliminary Notice in The State of Illinois?

A Preliminary Notice in Illinois is a document used in the construction industry to inform property owners, general contractors and construction lenders about the involvement of subcontractors, material suppliers, or other parties who are providing labor or materials to a construction project. This notice serves several important purposes: ensuring transparency and protecting the lien rights of those contributing to the project.

Purpose and Importance of a Preliminary Notice

The primary purpose of a Preliminary Notice is to notify the property owner that subcontractors or suppliers are working on the project and may have the right to file a mechanics lien if they are not paid. This notice helps to establish communication between the property owner and all parties involved in the construction, making the owner aware of potential financial obligations beyond the general contractor. It also helps prevent disputes by clearly stating the involvement of different contributors early in the project.

Who Needs to Send a Preliminary Notice?

In Illinois, subcontractors and material suppliers who are not in direct contact with the property owner must send a Notice to the Owner to preserve their lien rights for any construction jobs that are single-residence owner-occupied. For any job that is considered commercial, the preliminary notice is optional and not a prerequisite to the lien. The notice must be sent within 60 days of the first date they provided labor or materials to the project. This requirement ensures that the property owner is informed about all parties who could potentially place a lien on the property, allowing them to take necessary steps to ensure payment.

Requirements and Consequences

A valid Preliminary Notice must include specific information, such as:

• The name and address of the party providing labor or materials (the claimant).
• A description of the labor or materials provided.
• The name and address of the property owner.
• The name and address of the general contractor (if applicable).
• A statement indicating that the notice is being given to preserve lien rights.

Failure to provide a Preliminary Notice within the required 60-day timeframe can result in the loss of the right to file a mechanics lien. This means that the claimant may not have a legal avenue to secure payment for their work or materials, making it essential to comply with this requirement.

By properly issuing a Preliminary Notice of Lien, subcontractors, and suppliers in Illinois can protect their legal rights and ensure they are paid for their contributions to a construction project.

If you choose to work with us, we will ensure that all formatting and filling requirements are taken care of and that your Mechanics Lien is valid and acceptable with the county recorder’s office so that you can have confidence that your revenue is protected.

What Happens When a Claim of Lien Expires in Illinois?

In Illinois, a mechanics lien is a legal tool for contractors, subcontractors, and suppliers to secure payment for their labor or materials. However, a mechanics lien has a limited lifespan and typically expires two years after the completion of the work or the delivery of materials unless specific legal action is taken to enforce it. If a lawsuit to foreclose the lien is not filed within this period, the lien becomes unenforceable.

Once a mechanics lien expires, the lienholder loses the legal right to enforce payment through foreclosure. This means they can no longer compel the sale of the property to recover the owed debt. Although the expired lien might still appear on property records, it lacks legal power, potentially complicating property transactions and resulting in significant financial loss for the claimant if there are no other avenues to secure the unpaid amount.

To prevent a lien from expiring, it’s crucial to monitor deadlines and take timely legal action. Filing a lawsuit to foreclose the lien before the two-year period ends is essential. Additionally, if payment is received before expiration, the lienholder should file a release of lien with the county recorder’s office to clear the lien from property records.

How do I File a Mechanics Lien in Illinois?

Filing a mechanics lien in Illinois is a process designed to help contractors, subcontractors, and suppliers secure payment for their work or materials. To ensure your lien is enforceable, it’s essential to follow these steps carefully:

1. Confirm Eligibility: Ensure you can file a mechanics lien in Illinois. Contractors, subcontractors, and suppliers who provided labor or materials under a contract for a construction project can generally file.
2. Prepare a Written Contract: Have a written contract or proof of an agreement detailing the scope of work and payment terms. This document is essential when filing your lien.
3. Serve Preliminary Notice: Serve a preliminary notice to the property owner, general contractor, and lender within 60 days of starting work (required only for jobs that are at a single-family owner-occupied residence)
4. Serve a Notice of Intent to Lien: Serve the intent to lien to the property owner, general contractor and lender via certified mail within 90 days from last supplying material, labor, or services. Must be served no later than 10 days before recording a claim of lien. This is an early warning that you might file a lien if unpaid.
5. Complete the Mechanics Lien Form: Acquire and complete the appropriate mechanics lien form for Illinois, ensuring all details are filled out accurately, including a legal description of the property, the total amount owed, and the claimant’s information. Or you can order the Mechanics Lien from CRM and we will take care of the document preparation and the filing process.
6. Notarize the Lien: Get your completed mechanics lien form notarized by an official notary public. This step validates your document before submission.
7. File with County Recorder: File the notarized mechanics lien with the county recorder’s office where the property is located. Ensure correct and timely filing to maintain its validity. The lien must be filed within 4 months after completion of the work.
8. Serve Notice of Lien on Owner: After filing, serve a copy of the filed lien on the property owner through certified mail within ten days to notify them officially about the recorded claim.
9. Monitor Deadlines: Keep track of deadlines as Illinois law requires initiating foreclosure proceedings within two years from filing or risk losing lien rights.

Following these steps closely will help ensure your mechanics lien in Illinois is filed correctly and preserves your right to payment for services rendered or materials supplied on construction projects.

How Long Does a Mechanics Lien Last in Illinois?

In Illinois, a mechanics lien provides legal security for contractors, subcontractors, and suppliers seeking payment for their labor and materials. However, this security is time-bound, and understanding the duration of a mechanics lien is essential for protecting your rights effectively.

Duration and Enforcement

A mechanics lien in Illinois is valid for two years from the date the work was completed or the materials were delivered. This two-year period is critical for taking legal action to enforce the lien. If a lawsuit to foreclose the lien is not filed within this timeframe, the lien becomes unenforceable.

Important Deadlines

1. Filing the Lien: The initial lien claim must be filed with the county recorder’s office within four months of the last date labor or materials were provided. This establishes the lien on the property.
2. Foreclosure Action: To enforce the lien and secure payment, you must file a foreclosure lawsuit within two years of completing the work or delivering materials. This legal step is necessary to compel the property owner to settle the debt or face a court-ordered sale of the property.

Consequences of Letting a Lien Expire

• Loss of Enforcement Rights: Once the two-year period lapses without legal action, the mechanics lien expires, and you lose the right to enforce it. This means you cannot compel the property owner to pay through your lien claim.
• Effect on Property Records: An expired lien might still be visible in property records, potentially causing confusion but offering no legal standing.
• Financial Impact: Allowing a lien to expire without action can result in significant financial loss, as other avenues for recovering unpaid amounts may not be available.

To avoid the negative consequences of an expired lien, it’s crucial to adhere to all deadlines and take proactive steps to enforce your lien.

Get in touch

Understanding the duration and enforcement of a mechanics lien in Illinois is crucial for securing your right to payment in the construction industry. A mechanics lien lasts for two years from the completion of work or delivery of materials, during which time you must take legal action to enforce it. Failing to do so can result in the loss of your lien rights and potential financial loss.

At CRM, we have been serving customers across the country with required reference documentation for lien claims since 1986. We have a wealth of expertise, are licensed and insured, and have a team of highly knowledgeable document processors. If you’re looking for a straightforward process for filing a mechanics lien, give us a call or shoot us an email.

We would love to work with you and help you lower your risk and get paid fast!