Preliminary Notice Service

Notice Services Info


  • At A Glance

Preliminary notice services help contractors and suppliers research job information, prepare and mail construction notice forms, and keep track of all mailings and evidence of delivery.

Business owners, administrators, and financial professionals in construction will often encounter preliminary notice tasks. And it’s smart for them to look at available options that will make the notice process easier, and importantly, will free them up to do other more productive tasks.

When looking at “pre-lien services,” you’ll have many options, and will encounter all kinds of different companies and services offering help. You’ll be pitched by local, regional, and national providers; by mom & pop operations and full corporations; by law firms, collection agencies, “lien & notice services,” and software tools.  And you’ll find price points are all over the place.

Don’t get too overwhelmed. This guide will help you understand all the differences, what kind of questions you should ask in the buying process, and how to evaluate the players. Keep in mind that there are real differences between the varies service providers, and it’s important that your company find the best fit. Getting this wrong can cause a bit of heartache in the future.

The good news is that you can get a lot of value from a lien & notice service provider.

First, you can get value by taking a ton of tasks and follow-up items off your mind. Contractors and suppliers have a lot on their plate when it comes to preliminary notices. Here are just a few things:

  • Researching prelim requirements, and rule details;
  • Collecting & verifying project information;
  • Preparing preliminary notice documents and forms;
  • Keeping track of notice deadlines (and lien deadlines!);
  • Mailing the notices;
  • Keeping track of certified mail tracking numbers;
  • Managing returned mail and re-sending notices;
  • Having good document retention practices for notices.

Second, you can get a lot of value in payment speed and payment certainty by improving your processes. Since managing preliminary notices in-house can be so tedious and time-consuming, it’s extremely common for companies to sometimes not get around to it on a certain job…and that comes back to bite them! Finding a construction notice solution to rely upon will help immediately with this — because it will always get done. But, beyond that, here are a few other ways notice services can get you paid faster and more frequently:

  • Professional & well-designed notice documents (which great notice solutions will provide to you) protect your rights and improve your relationships;
  • Tying together your preliminary notices process with the lien waiver & payment application process will make payments more streamlined (and faster!);
  • Having resources on-hand to address slow payment situations will allow you to react fast to any issues that arise.

While going through this guide, the frequently asked questions and other information, keep asking yourself: What do you want to get out of a preliminary notice service?

Lien Notice Service Frequently Asked Questions

Here are some questions that may come up when evaluating services that can help you with construction notices. Keep in mind that these are also questions that you should be asking to service providers or software tools in the buying process.

Should I use a notice service on all of my jobs, or just jobs that we think will have payment problems?

This question has 2 components. First, about whether you should send notices on all jobs or just some. And second, about whether you should selectively use a third party service or tool to send all of your notices, or just on some hand-picked jobs.

We've written extensively about the practice of sending notices only on "problem jobs." Check out "Why It’s a Bad Idea to Send Preliminary Notices on 'Problem Jobs' Only" for a more extensive discussion. You should send notices on all jobs because it's a best practice that helps everyone administer payments better, and not just a lien rights mechanism. Further, when it comes to lien rights, construction cash flow is crazy unpredictable. You cannot safely predict which will be a "problem" and which will not. The trouble with "preliminary" notices is that they must be sent at the very start of a project - way before you can know when you'll be faced with an unexpected problem.

This leads us to the meat of this question: Should you use a notice service or software all of the time, or only on select jobs?

Different companies will have all kinds of different filters for this. Some companies hand-pick the jobs they want a third party to handle. Some companies set dollar limit thresholds (i.e. anything over $5,000 will go through the service). Etc.

When these policies are closely examined, it's usually the case that they are put into place because of some limitation with notice services and notice tools.

For example, a company may choose to send notice only on "problem" jobs or high-value jobs because the cost of sending notice is too high. Or the time it takes is too demanding. Or some other limitation like this.

Notices should not be so expensive and complicated, and in reviewing a service or tool to help you with the process, you should consider whether the service/software is going to empower you to use notices to the fullest, or if you'll need to be picky. Ideally, you should have a single place that can help you with 100% of your jobs.

How much will the service cost, and what are all of the fees?

When reviewing "Lien & Notice Service Providers" - as they are sometimes called - you will encounter a lot of different ways of charging, and a variety of fees and price points.

Pay Per Document
A lot of "notice services" will charge you "per document" to help with sending preliminary notices. Generally, this will be $15-30 per document. Here are a few notes about this:

  • Does the fee include postage? The fee quoted to you may or may not include postage. This is an important point because postage can cost an additional $6-15 per notice sent. Make sure you add this to the quoted fee!
  • Does the fee include "Job Research?" Getting your job researched is not part of "sending notice." These are actually two different things. See what research and data access is included in the fee.
  • One and done? Does this fee help you with all the notice incidentals related to the entire project? Or just is the fee to do this one sending activity? For example, what if the notice mailing is returned? What if a followup notice must be sent? Etc.
Paying for notices "per document" is a simple and traditional way that preliminary notice services charge for notices. This is typical in the industry because historically, all lien & notice providers were service providers who would charge for every service provided. As offerings have widened for contractors and suppliers, however, charging per document has become less optimal and too expensive.

Pay Monthly For Unlimited Docs
The preliminary notice solutions available to contractors and suppliers have widened substantially in the past 10 years. As solutions have become more broad and robust, it has become increasingly popular to not pay for notice documents one by one. Instead, companies will pay a flat monthly fee to get all types of help with preliminary notices, lien rights, and the payment process, and will be able to send an unlimited number of preliminary notices.

This is an ideal way to pay for help with preliminary notices for the following reasons:
  • You & the notice provider have aligned incentives: Everyone is on the same page that the #1 thing is to make your payment process easier, not to drum up more notice deliveries.
  • You know what to expect: The cost is the same every month, and you know exactly what to expect.
  • You get more. When you pay $20 to send a notice, that's exactly what you get: a notice sent. However, when you buy a complete and comprehensive solution, you get your notices sent and a whole lot more.

Depending on the size of your company, the number of features you need, etc., the flat monthly cost to get notices handled for you will generally range anywhere from $80/mo to $800/mo.

Do preliminary notice services need to be licensed?

In some cases yes, and in some cases no. This answer will explain why, and explain why this is super important to your decision.

To answer this question you must figure out whether you are thinking of using a "preliminary notice service" or a "preliminary notice solution." There are key differences.

Traditionally, a "preliminary notice service" is just that: a service provider. Service providers consult with you, personally provide you with advice, and when it comes to notices or liens, they will create these documents specifically for you, by hand. Generally speaking, across the United States, there is an argument that such preliminary notice services are illegal, except in California and Arizona, where they require a specific license.

Although lien & notice service providers are everywhere across the United States, there is an argument that these companies are engaged in the Unauthorized practice of law by preparing legal documents as a service. In California and Arizona, there is a "Legal document preparation" license, that would authorize service providers to operate under restrictions in those states.

So, if you are thinking of a notice service in AZ or CA, make sure you check the LDA license. Elsewhere...buyer beware!!

However, this is much different than a preliminary notice solution, such as a software solution, or SaaS (i.e. software as a service) solution, like Levelset.

Solutions like Levelset help you better manage the preliminary notice process, the job research process, and other matters. These tools are coupled with helpful resources (i.e. like our resource & learning center), customer success expertise, training, and help (i.e. like our CS team), and access to expert answers (i.e. like our expert center).

As a tool that empowers you to make the preliminary notice process easier, a license is not required.

There are a few things that makes this seemingly technical issue important to you and your company.

If you use a service that is unlicensed or otherwise illegal, and a mistake is made, it's possible that you will not be covered by their errors & omissions insurance, or otherwise have any remedy against the service, because the service was illegal!

Another potential pitfall here is that something actually goes wrong, a document causes some type of problem, etc. In this case, since you were using some illegal service, you may be held liable under some negligence theory.

What happens when a notice service messes up?

Getting your preliminary notice right is important, and it's complicated. As we explore in our Preliminary Notice FAQs and Guide, the rules are different everywhere, and the rules are really, really complicated.

Before talking about what happens when a service provider messes up, you may want to first think about how to avoid that possibility as much as possible. And with so many rules, and things that can go wrong, one way to avoid it is to select the best, most comprehensive, and most tech-enabled solution there is. Technology & computers are great at handling all kinds of logic puzzles and rules. You're familiar with TurboTax, and LegalZoom, and even sales tax automation software like Avalara. You wouldn't dream of pulling out a tax table book everytime you had to figure out sales tax for a new place. You'll let technology do it! And that's because this type of rules/logic is best left to technology, who will mess up the least.

That brings us to what happens when things go wrong.

The FIRST thing you'll want to do, and you'll want to do it right away, determine whether you can salvage the situation. Can you take immediate action to fix the mess-up, or mitigate it?

If not, you'll need to consider your recovery options against the preliminary notice service provider.

As explored in the previous question, "Do preliminary notice services need to be licensed?," you'll want to be careful about selecting a notice service that is illegal or unlicensed because in the event something goes wrong, you may be out of luck. Any insurance that the service provider has may decline coverage since the policy will not cover illegal activities!

The next question will explore errors & omissions insurance. One option you may have if your notice service provider messes up is to make a claim against their errors & omissions carrier.

Do preliminary notice services have errors & omissions insurance, and how does it work?

Preliminary notice service providers may have errors & omissions insurance, and certainly, when choosing a company to help you with this process, you'll definitely want to make sure that they have this insurance protection.

Errors and omissions insurance will protect you against mistakes made by a service provider or other solution. However, it's important to understand the limitations.

You must remember that E&O insurance is never a blank check to you. Whenever a claim is made against an E&O carrier, the insurance company will investigate the claim and make a determination of coverage. Many things will be taken into consideration, such as:

  • Was the provider operating illegally? We explored this in some of the above questions. This could impact whether any coverage is available.
  • Did YOU make a mistake that would render the service providers mistake 'moot'? If the service provider or solution made a mistake, but that mistake wouldn't have mattered because of some other mistake that you made with the account, then you may be out of luck. The insurance carrier will determine that the service provider's mistake didn't cost you anything. because of the other mistake.
  • What are your terms with the provider? The E&O carrier will assume all the terms that you have with the provider.
These are some of the considerations to keep in mind when making an E&O claim against a notice provider or notice solution.

Should I use a pre-lien notice service if they are also a collection agency?

It's up to you, but in our opinion, no.. You should be careful when using a collection agency who also offers preliminary notice services. And there are a few reasons why.

  1. It sends the wrong message. Notices are not supposed to scare your customer. They are not supposed to be adversarial. Sending a notice through a collection agency (or law firm) sends all of the wrong messages.
  2. It is lead generation for them. Collection agencies began offering these services as a way for them to generate leads for their collections business. This is not a reason that aligns with your goals...in fact, you want to AVOID collections. It's against their interest to really help you.
  3. There is a big unauthorized practice of law risk with collection agencies who offer preliminary notice services
  4. They are going out of business!! Service providers are increasingly being replaced by technology offerings, or "software as a service."  It's not uncommon for collection agencies to go out of business, to increase their prices, or do other things that would be inconvenient for you.

How will I get my questions answered when using this notice service?

Really. Really. Important. Question.

How will the notice provider or solution support you? How easy is it for you to contact them? How quickly will they respond? How big is their team and how many resources will they have to answer all of your questions quickly & completely?

Offering great service is not easy. The problem with preliminary notices is that they sometimes require you to make fast decisions and to take quick action. You need to be supported in doing this to have all the information you need at your fingertips. Make sure that the solution you choose will always be there for you, and will be there when you need it, and will be there quickly.

How does a notice service provider manage the different forms?

There are hundreds, if not thousands, of different form variation for lien rights documents (like preliminary notices). And, as you can see from our Legal Alerts, it's not uncommon that these forms are changed or impacted by new laws and cases.

The challenge with pre-lien notice services is that they frequently don't have the resources and expertise to manage these changes. This is why these services have traditionally been very local. That's as much change as they can handle.

So there are two components you'll need to inspect about a pre-lien notice service in this area:

First, whether they have the expertise to manage the different forms and legal changes. This takes people, and processes, that are consistent. Does the notice service you're looking at just get information from the blog-o-sphere or word on the street, or consulting with attorneys, or do they have a department or person dedicated to keeping up? Obviously, you want the latter one.

Second, you need to ask whether they have the expertise. Even if they do have someone or some department dedicated to keeping up, look more deeply into their credentials. Look into their expertise and education in this area.

At Levelset, we have a legal group that has multiple experienced attorneys, and construction law attorneys. We also have a network of construction law attorneys who are engaged in our community. Our legal department keeps up with legal changes, new cases, and more, and is a thought-leader in the space on lien rights, notice requirements, and construction payment topics.

How does a preliminary notice service research job information, and why is it different than just doing it myself?

When it comes to preliminary notices, job and stakeholder research is extremely important. In fact, these are two different things. One thing is generating, sending, and tracking your prelim. The other separate thing, though, is doing job and stakeholder research to make certain you have all the data you need on a job. It's this second thing that is the focus of this question.

When looking at preliminary notice services, you'll likely encounter many that claim to offer research services. These services help you research your project information to fill-in gaps of your knowledge about a project. Who, for example, is the general contractor on the job, or the property owner, or the lender?

You may be wondering how this is any different than you doing the research yourself? And that's a great question. In fact, it's the most appropriate question.

Clearly, one benefit of having someone else do your job and project research is simply that: someone else is doing it. As a result, this will save you time and headache. There are benefits to just straight delegating this to a third party service. Time is money. You’ve heard the phrase 10,000 times, and you probably think it’s true. Yet there are some companies out there still willing to fumble around with preliminary notices despite the time it takes, the in-house cost it carries and the risk of error.

However, the bigger benefit is when you can get access to some property and construction project research that you may not ordinarily be able to access. When evaluating pre-lien or prelim notice "services" or solutions, this is the holy grail.

Contractors and suppliers who use Levelset, for example, are plugged into a vast network of data and participants. This includes tens of thousands of contractor and suppliers who use the Levelset tools, many proprietary data partnerships and integrations, and millions and millions of data records about construction projects and job participants. This is much different than doing the research work yourself and on your own.

What's better - a preliminary notice service, or software? And what's the difference?

Well, this depends a great deal on what you mean by "software." If you're talking about a desktop installed software application -- so called "on premise" software -- these are becoming extremely outdated and should be avoided at all costs. The costs to update and maintain them are too great, and when it comes to prelims, lien waivers, and other items like this, which update frequently, it's just too cumbersome. This is why so much software has gone the way of SaaS tools, and we are seeing the collapse of many on-premises preliminary notice software tools (which, by the way, leave its customers in pain looking for a new solution!).

Further, old-school software left you with a lot of work to do on your own, such as:

  • Determine if the project is a state, federal, commercial or residential project
  • Find the property owner (the actual one)
  • Find the lender (in many states, see a how-to find the lender here)
  • Fill out the form or input the data into software
  • Print the forms, envelopes, envelope labels
  • Apply postage to your envelopes, and prepare certified mail slips
  • Prepare a declaration of delivery and sign it
  • Track the mailings, and if any come back, re-mail it by doing #s 4-8 again
Forgetting or doing any one of these things wrong could be fatal to your mechanics lien rights.

SaaS software preliminary notice tools, on the other hand, are filling in all of these gaps and empowering companies to make preliminary notices extremely easy. And these type of tools and software products are much more preferable to a traditional service provider.

The difference between a SaaS notice software tool and a "service" is extremely large.

In looking for a preliminary notice service or solution, you really want to look closely at the technology they offer.

As more business software moves to the cloud, it’s important to find a construction notice software company that leverages technology to improve the preliminary notice process by increasing security and accessibility. Documents and historical records should be stored securely in the cloud, with easy access from any internet-enabled device by personnel with the right credentials. The company should rely on a reputable cloud server solution like AWS or Google, which are more secure and reliable than on-premise servers that require updates and maintenance and present security risks.

Most importantly, evaluate the capabilities of the construction notice software. How much manual attention is required? What data must be input by the construction company and what data does the notice company research? What databases or sources of information does the notice company use? What is the turnaround time between ordering a notice and it being sent? Software algorithms updated by best-in-class engineers with feedback from construction attorneys can ensure that the right notice is sent at the right time and to the right people. Look for a software that integrates with with other SAAS (software as a service) tools such as QuickBooks and is capable of setting up custom integrations.

The "service providers" occupy an entirely different rung on the technology ladder, as well as being severely limited in scope by the very nature of their offerings. Where a complete technology platform can give a party complete control of receivables and total, customizable, and automated (if desired) leveraging of their security rights to guarantee payment on every project, service providers are stuck in offering a one-off, old-fashioned, one-document-at-a-time process, with no overarching ability to control and manage their rights.

We're Always Here To Help You With Preliminary Notices

Get Free Expert Advice

Ask your notice questions to payment experts for free

What would be the best document to file in CA if we have not been paid for our last invoice?

We worked on a job for around 3 years and sent our last invoice only July 23rd that we have not received payment for. I...

Preliminary Information Requests

Do you provide preliminary information services? I am looking for someone to research and provide property owner information on a project.

Clarification on Preliminary Notice – Wisconsin

I'm confused what a Preliminary Notice is. I'm the GC working on an addition to a single family home. I did not have a PN...

View more questions & answers

Send Notices That Make Your Relationships Better

Preliminary notices can protect your lien rights without looking so formal and scary. Upgrade how you protect your lien rights and how you interact with your customers by sending clear, clean, and collaborative preliminary notice documents!

Levelset’s SET Notice Documents are perfect for your company:

  • Designed by construction attorneys and payment experts, they do 100% protect your lien rights;
  • Your customers and other job stakeholders love receiving them, because they are clear and helpful;
  • They don’t look like legal documents and so they will not scare your customers or other stakeholders.

The Levelset system also makes sending, managing, and tracking notices easy, fast, and accurate.

Contact Us To See How It Works

preliminary notice software & service

Our Research & Data Fills In Your Job Information Gaps

Getting the document generated, sent, and tracked is only half the battle. The biggest headache with preliminary notices is getting the job information right!

Finding the property owner, construction lender, surety, and general contractor on the job can be extremely challenging.

Levelset helps by:

  • Having humans research your job information!
  • Giving you access to our exclusive database of millions of projects and contractor relationships;
  • Connecting you to exclusively available third party data partners.
  • Protecting you with legally protective data collection processes.

Contact Us To See How It Works

preliminary notice job research

Payment & Research Experts Help You At Every Turn

866-720-5436      |    Let’s Chat  

Greg Saunders

Payment Expert

Meghan Overheim

Payment Expert

Will Martin

Payment Expert

Ron Leon

Payment Expert