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How can we recover insurance recoverable depreciation customers did not pay to us?

TexasMechanics LienNotice of Intent to LienRecovery Options

Some customers have the tendencies to just keep the last check from the their insurance even though that money is part of the whole job that was paid for completion

1 reply

Jul 23, 2019
I'm really sorry to hear about that. Everyone should be paid what they've earned. When unpaid for construction work performed, there are typically a few different recovery options available. Though, if possible, talking things out and coming to an amicable resolution should usually be the first step of any recovery process.

Notice of Intent to Lien
Mechanics liens are a powerful recovery tool, and because they're so powerful, the mere threat or warning that a lien claim might be filed could be enough to compel payment. By sending a document like a Notice of Intent to Lien, a construction business can show that they're serious about getting paid, and that they're not afraid to do what it takes to get their hands on what they've earned. Considering the drastic implications of a lien filing, warning that a lien claim may be filed is often enough to get paid. More on that idea here: What Is a Notice of Intent to Lien and Should You Send One?

Mechanics lien
Filing a mechanics lien is often seen as the nuclear option, but filing a lien may become necessary if an owner refuses to make payment. By filing a mechanics lien, a contractor puts the owner's title in jeopardy - and, if the claimant remains unpaid and ends up enforcing the lien, the owner could even lose the property. This, among other reasons (Levelset found 17!) make mechanics liens a strong recovery tool. The majority of lien claims filed are resolved without the need for further action, and payment typically comes quickly. More on that here: Texas Mechanics Lien Guide and FAQs.

Other options
Of course, there are always other options outside of the mechanics lien process that can lead to payment.

For one, depending on the size of the claim (if it's $10,000 or less), small claims court might be a viable option. By pursuing a claim there, rather than through traditional litigation, claimants can avoid significant costs and delays. More information on that here: General Info on Texas Small Claims.

Further, just like with a Notice of Intent to Lien, threatening to bring the debt to small claims court or to more traditional litigation (under a claim like breach of contract) could help to get paid, in and of itself. For a little extra "umph", sending a payment demand letter via an attorney might do the trick. Threats to send the debt to collections could work, too.

Finally, pursuing litigation is always an option - though, it can be expensive, time-consuming, and risky.
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