Can a subcontractor put a lien on my brand new construction house after i closed?

3 weeks ago

I recently closed on a brand new construction single family house and the builder, not the seller, is asking for additional money for “upgrades” that I never approved. There was no written notice stating the upgrades nor was it ever approved by me. Can they file a lien on my house and would i be responsible for it or would the seller, that hired him to build the house be responsible? This is in Chicago IL.

Senior Legal Associate Levelset

Mechanics lien rights tie directly to the project property and don’t arise against a specific party. And, when the project property is sold, a party who performed work prior to that sale will generally still be entitled to file a mechanics lien after the title is transferred. Levelset discusses that idea here: What Happens If I Filed My Mechanics Lien After the Property Was Sold?

Of course, in order for an Illinois mechanics lien claimant to have a valid and enforceable lien claim against the project property, that claim must be filed within 4 months of the project completion. After that, they won’t be entitled to bring a lien claim against the sold property.

Illinois property sellers aren’t off the hook for lien claims

A mechanics lien being valid doesn’t mean the seller isn’t responsible for making payment. A purchaser will generally have a number of options for bringing the seller back into the dispute. Specifically, when selling property, the seller will typically provide certain warranties in the sale – and if they’ve sold a property that liens and payment claims may be made against due to their failure to pay, they’ve likely run afoul of those warranties.

What’s more, bringing the title company into the matter can be helpful, too. It’s the title company’s job to ensure that the purchaser is getting a clean title to the property, and if a claim is made with the title insurer, they may be required to intervene. Further, it could also be helpful to alert the mortgage company. Work that is performed prior to a mortgage will often give rise to a mechanics lien that has priority over the mortgage. Meaning, the mortgage could be at least partially unsecured by the property. Mortgage companies don’t like that, and they may also be helpful in compelling a seller to intervene and resolve the payment dispute.

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