A great tool that I always reference on the Levelset website is the zlien Charts and White Papers page. There are a number of helpful resources on this page. Today I will discuss the map regarding the zlien Map of US Notice Requirements summary of construction notice requirements. In particular, this map indicates states where a Notice of Intent to Lien is required, states where a Preliminary Notice is required and states where both, or neither, are mandatory.
Notice of Intent to Lien, Where Required?
A Notice of Intent to Lien is a notice that makes an impression on recipients. In fact we have many clients who send these as a matter of course because they result in payment so often.
Some states actually require some type of Notice of Intent to Lien. These states are listed below.
- North Dakota
Advantages to Sending Notice of Intent to Lien (When Required)
The major advantage to sending a Notice of Intent to Lien when its required is to preserve your lien right. Take Colorado for example, the lien law requires the following:
§ 38-22-109. Lien Statement
… (3) In order to preserve any lien for work performed or laborers or materials furnished, there must be a notice of intent to file a lien statement served upon the owner or reputed owner of the property or the owner’s agent and the principal or prime contractor or his or her agent at least ten days before the time of filing the lien statement with the county clerk and recorder.”
Advantages to Sending Notice of Intent to Lien (When Not Required)
Conversely, the majority of states do not require a notice of intent to lien be filed to preserve a privilege. This should not keep the tool out of your company’s lien policy, however. I often tell clients that a Notice of Intent to Lien is very much akin to a demand letter.
A Notice of Intent to Lien is a good and inexpensive way to let the non-paying party and other parties know what is about to happen. The standard notice we send says that if payment is not made in 10 days, then a lien will be filed thereafter.
Notice of Intent to Lien is a Smart Addition to Lien and Credit Policy
Here at Levelset we talk about smart lien policy and smart credit policy all the time. In this instance, I always recommend to clients that they file a notice of intent to lien. Its literally a tenth of the price of filing a lien and many times it achieves the same result.