Can an individual file a lien on a property?

6 months ago

I deposited earnest monies with a builder for construction of a home. I lost my income and now don’t qualify for a loan. Builder stated would refund earnest money upon sale of home. How can I guarantee I will get my money when he sells the property without a lien?

Additional info about this contractor
Project Role: Other
Project Type: Residential
Senior Legal Associate Levelset
478 reviews

Mechanics lien rights are really only available for those who perform work on a property but go unpaid for that work – typically, lien rights will be available to construction businesses. Other types of debts – like the promise of returning earnest money – won’t give rise to lien rights.

A prospective buyer and a builder could enter into an agreement to secure payment via a lien on the house – but that lien would need to be agreed upon by the builder. And, it’d hardly be surprising if they refused, especially since having a lien present would make it harder to sell the property.

Asking them to secure that debt by placing a lien on the property might be a bit aggressive – though, it’s possible they might agree to that. But, having a written contract agreeing to the release of earnest money might be a more attainable goal. And, if the original contract for the build stated that earnest money must be returned, then executing an additional agreement might not be necessary.

Disclaimer: The information presented here is not legal advice and should not be construed as such. Rather, this content is provided for informational purposes. Do not act on this information as if it is advice. Further, this post does not create any attorney-client relationship. If you do need legal advice, seek the help of a local attorney.
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