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When someone files a lien against you

I hired a contractor and I refuse to give final payment because of the shoddy work. They say they will put a lien against me. Can I put up a bond to cover the lien amount while we work this out in small claims court? Is this called Bonding Around a Lien?? Thanks!

1 reply

Aug 30, 2019

Yes. This practice is referred to as bonding off the lien claim, or more specifically in Iowa discharging the mechanics lien through a bond. Bonding off a filed mechanics lien can be an easy, short-term solution to remove the cloud of lien on the property while the dispute is sorted out. This is expressly allowed by Iowa Code §572.15, stating that a mechanics lien may be discharged at any time by submitting a bond. One thing to keep in mind is that this comes at a steep cost. In order to bond off a lien claim in Iowa, the bond must be for twice the amount of the lien claim. Once a bond is secured, it must be approved and filed, similar to how mechanics liens are filed. Upon approval, the lien will be discharged, and the bond will act as a substitute for the property. For more information on bonding off mechanics liens, you should read our Primer on Bonding Off a Mechanics Lien.

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