Levelset visitors can also get a free Procore account.

How to Communicate With Sales Teams About Lien Law

Project Type


Experts in this video

Lori Drake
Lori Drake
31 years experience

At a construction company, the relationship between the sales department and credit department can be a tough one to navigate. If you’re a credit manager looking for ways to better align with your sales team, communicating your priorities around lien rights and managing risk is a good place to start.

Watch this course to learn:

  • How you can talk to sales teams about lien law
  • Easy ways to maintain the sales and credit relationship
  • How to get sales teams excited about helping with the lien rights process


Jon Weirich (00:00):

If my attention span as a sales rep is short and there was one really important thing about leaning on one rule that was maybe, um, best to keep in mind. What would you want? You know, every, every construction sales pro to know,


Lori J. Drake, CBA (00:13):

I would say the easiest thing to remember for salespeople. It’s just to fill out those job forms, complete data. They know who the owner is. If they know who the contractor is, ask the right questions to their customer, don’t be afraid to ask. I mean, if they say, I don’t know who the contractor is, we’ll then ask them who their contractor, or I don’t know who the owner is. Well, check their contract and have a look because the owner is going to be listed on that. Having all the job information is going to help everybody right from the start, there’ll be able to protect your lien rights. You’ll be able to contact the right people to get paid. And unfortunately, if need be, you’ll be able to file a lien, protect your right. Thank you for taking the time out of your busy schedule to meet with us today. Today, we’re hoping to mend the relationship between sales and credit as it is in regards to lien law. Why we asked for what we asked for what we do with the information and how it is utilized. I’m also joined today by John Wyrick, who is the little tech payment expert.


Jon Weirich (01:16):

Hey, Lori, super excited to be here. Yeah. Tell us a little bit about your background. Yeah, absolutely. So I have had the pleasure of selling level-set to construction companies now for almost five years. Um, and specifically these days I actually coach our sales reps and I help our sales reps with training and just understanding why lien law matters to credit professionals like yourself and the businesses they work for.


Lori J. Drake, CBA (01:40):

Well, you’re probably wondering why should you listen to me? What makes me an expert on any of this stuff that we’re going to talk about? I’ve been a credit manager for over 17 years. The last 13 I’ve specialized in Texas with construction lien loan. When it first came to thought, I had informed my sales departments that I wanted to teach them the class. It’s like this explaining why I’m asking for what I’m asking for, why they should provide the information and outward and utilize that information. The biggest surprise to me when I did the presentation was how many salespeople have no idea what lean law even was? They knew they were supposed to fill out job form. They knew that we demand payment on the 14th. Well, I can’t, I just pick it up. When I go home on the 15th, they had no idea what was going on.


Lori J. Drake, CBA (02:30):

It actually was really surprising to me because some of those failed people have been there for a long time. So it was a great idea, sharing this information with them and powering them to not only know the information for himself, but share that information with their customers. When a customer says, well, I don’t have a home builder. I don’t have a GC. They can actually say, well then who did you sign the contract with? Or if they see that the material is delivered to the lot next door to where the job is, I, we deliver material to that job. Why didn’t we do it to the other job? You can tell when a customer is trying to play with the information, they know what they’re doing, and they do try to hide it. And if they do any of that, unfortunately you won’t have any lien, but marrying yourself people to know what they’re talking about and knowing what to it’s definitely beneficial to the entire company. Well, we can go. I wrote an article on the credit and sales relationship. I did it with a peer of mine, Jackie whole thing, which I’m sure a lot of, you know, it was six tips on how to mend the relationship between credit and selves. There was great information in there. Be just how to be a person with your sales team and showing them that we are on their side and they’re not trying to push them. That’s fine.


Jon Weirich (03:45):

Awesome. Lauren, I’m excited to hear a little bit more about this, but if I know most sales reps, they’re also going to be concerned about what’s in it for them. So do you mind giving me a little background? You know, why is it important to understand lean law? If I’m a sales professional out at a supplier or another construction company?


Lori J. Drake, CBA (04:02):

The reason it’s important is because typically sales are not paid their commissions, unless the balance is collected. Um, you don’t get paid commission. I know a company they had where once it hit 90 days, if they ultimate locked 25% of their commission, once it hit 120 days, they lost 50% of their commission. If lien had to be filed on it, they didn’t get paid their commission at all. No, it’s very important on the sales side, just to make sure you can, you know, you’re not making sales, that aren’t going to be an official to you as far as why you should understand the information and provide the right information. It makes it so much easier. Say a credit doesn’t have to provide the information or look up the information themselves. We can get your job answered immediately. We can put all the information to the necessary. Your orders can go in there right away, and you get faster release of your material longer. It takes that we have to verify all the information. Unfortunately, if you need material right away, it could take a week or two before you get that out.


Jon Weirich (05:07):

So it sounds like it does the sales rep. Good. It does the reps client. Good cause they’re going to get their materials released and it makes your life a little bit easier. And credit.


Lori J. Drake, CBA (05:15):

The things I always loved about lean LA is that I had so many different directions to collect payment from. Normally you deal directly with your customer. If you try to go around your customer, that’s more gets mad. The salespeople get mad. You get called from your bandage or asking why you’re calling around the customer. But with Lima, you’re allowed to contact anybody that then that payment chain, you can contact your customer. You contact. If they’re good, you see a homeowner on tack to the owner of the property. If the company you can get through the company and talk the partner. If with that individual, you can contact both the whole thing. And my wife, if you find that information, you have so many more avenues collect payment from all it does is it may irritate the people down the line, but it makes the conversation move down the chain and get the customer to respond, tell you what’s going on.


Lori J. Drake, CBA (06:07):

And at the end of it, hopefully you get payment for our green part type of project that we want to be able to differentiate their private public and fed. And this presentation, we are only dealing with private. When we asked our sales people to fill out a job form, they need to know why they need to know what we do with the information, why the specific information is needed and how we go about utilizing that information. If we have lien rights, we have a larger, like I said, a group to contact and get payment from this helps sales connect better with credit because they know where their customer is and where everything lies, no matter how hard you work, no matter how hard you’re trying, or you think you got the information, there are always mistakes. When you’re dealing with lean on him, he does not or mistakes that people typically make when they deal with Lima bilingually.


Lori J. Drake, CBA (06:58):

When you actually don’t have any lien rights, typically that could be a fit the hunted for a residential project. Or if you delivered mirror material to the illiterates next door, or you may have even just flat out wrong general contractor. Well, if you don’t notice the right general contractor, you’re you lose your lien right on that as well. You think incomplete or incorrect information, it’s the same thing you have to make sure and verify who the property owner is. Who’s managing the project, all that information, missing your deadline by filing too late or not for clothing. This is a big one. We actually have a Reddit community that that’s question’s been answered. But one of the questions that I get asked is, Oh, I forgot to send my notice yesterday, or I haven’t sent any notices. Can I still file a lien? Unfortunately, if you miss one, notice one day, all of your lien rights are gone and you can’t put them up. There are other things that can help you, but we’ll discuss those in later. Well, you definitely have to watch those deadlines to make sure you don’t miss any of those. And then failing to send a notice of intent before filing a lien, kind of the same thing. If you don’t send the notice when it’s due, and if you don’t send any notices, there is no captured money and you cannot file a lien.


Jon Weirich (08:18):

Now I can already hear the first excuse though of my customers are never a problem. All of my customers pay. So if I’m the sales rep that only sells to good contractors out there, um, how does having this job information still make things easier for maybe the business as a whole


Lori J. Drake, CBA (08:36):

Not information and all of the I’ve dotted and the T’s crossed actually helped your company get bonded. We have to reach a certain amount of information, make sure that it’s all correct to obtain the bonding for all of the customers that we are financing. So it’s really an official, not only for the credit department, but for your company, they can add more credit. They can help provide new customers. It really is beneficial for everybody. This slide is actually for salespeople. It’s what they can hope the credit departments do. So that there’s a mutual understanding. Getting the information before any labor or material is provided your, for the customer to give you that information before they know what you’re going to do with it, they can watch their aging. I know a lot of salespeople don’t do this, but if they would pull their own aging every month and see, you know, if you have a customer that’s 60 days out, 90 days out check with your credit department and see what the story is going on there.


Lori J. Drake, CBA (09:39):

If credit can’t reach a customer or obtain payment, no, a lot of salespeople don’t like to be the bad guy, but it’s helpful for you in that of just letting us send notices and Pauline that’s helpful for you to call them and just see if there’s a situation. Maybe it’s a failed issue. Maybe it’s a delivery issue. Just see if you can help find out what the information is. And then don’t forget to relay that to your credit manager. It will not find out any other way for you. And then all the way up again, um, make sure that, you know, the timeline maker that they did submit the payment or that you can go pick it up before the timeline. Uh, I’ll talk about this more later, but typically all notices will go out unless it’s failed person or the company has the check in hand. Well, if he likes the last and the information that we provided, we have a lot more to share with you. Thank you again for watching. If you like what you saw, please subscribe to Levelset.