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Liens on New Home Construction

UtahPreliminary Notice

I have pre liens against my property, where payments have been made. I also have a lien against my home that I was never informed of. The person who filed that lien never supplied a bill and they did not complete the work - it did not pass inspection. The lien was put on the property 10 months after the work was done. These issues are holding up my loan. What are my options.

2 replies

Oct 27, 2021

You should speak with a construction attorney as soon as possible to discuss your options, including strategies to mitigate your damages.

The preliens (technically called "preliminary notices" or "prelims") may not be a problem. Most prelims that are filed are never acted upon and simply expire. A construction attorney could help navigate this process with a lender.  

Per Utah Code 38-1a-501, a notice of lien must be recorded within 180 days after "final completion of the origincal contract" (or a shorter time is a notice of completion is filed). Determining the date of "final completion" depends on many factors including whether the contractor hired directly by the owner or was a subcontractor, and other factors. Utah law provides various remedies for owners who are affected by wrongful, untimely, and/or excessive liens. Those include: (1) temporarily bonding around the lien which would let you proceed with the loan process - that process lets you move fast, but can be expensive; (2) litigating the issues, which would include asking the court for an order removing the lien and for damages (plus costs and fees) - that process can also be expensive, and takes time; and (3) working directly with the contractor - if the contractor can be shown that the lien was filed in error and he contractor's liability, and will agree to remove the lien voluntarily, that would be the fastest, simplest, and cheapest option.

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Oct 27, 2021
Thank you - One of problems the sub who put the lien on refused to talk to the contactor.
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