How to Navigate Lien Laws in Texas and Get Paid Faster
The Lone Star State is an outlier in the mechanics lien world, as Texas easily wins the award for having the most confusing and tangled set of lien laws. Contractors, subcontractors, suppliers, property owners, construction lenders, and other vendors will encounter all kinds of lien-related paperwork and questions when working on Texas-specific construction jobs.
Join us for a free live webinar where we will cover all the ins and outs of Texas Lien Rights.
Register for this webinar to:
- Better understand complex Texas Lien laws
- Learn how (and when!) to file a mechanics lien step-by-step
We will also have our payment expert, Jeffrey Collins, answer any questions about Texas Lien Rights!
Speaker 1 (00:04):
Great. So welcome everybody today. We’ll just get this moving. All right. Kathy offices in Houston and Dallas. That makes sense. Um, I’m sure you all, you know, pretty much know why we’re here today and we’re excited to, uh, to dive into all things lean rights for those of you that are working in Texas. Uh, first of all, I would like to congratulate you guys on working in Texas with the most complex and hardest set of lean rights possible throughout the entire country. So I’m glad you all made it today. Um, I’m guessing that you’re here for a number of different reasons. Uh, typically you may already have a process in place for sending out lean rights paperwork. Um, of course it’s typically taking a ton of time and a ton of your resources away. So you might be looking for a better way to do this.
Speaker 1 (00:53):
Um, or you might just occasionally be sending out this paperwork and trying to kind of set something up a little more regular, um, in Texas, either of those ways are okay for managing lean rights, but of course can be pretty stressful. Um, and overall just straight up time consuming. So no matter why you guys are here today, uh, one thing I can guarantee is that you’re gonna leave here today, knowing exactly how you could take steps to manage these lean rights in Texas. Um, before moving forward, I do want to quickly again say that this is going to be recorded. So, um, usually within about 24 hours, we’ll have a recorded version of the webinar sent to your email that you registered with. Um, and then of course, if you have questions that I don’t have time to address, I will follow up with you starting as soon as this wraps up today.
Speaker 1 (01:40):
Um, make sure to use that Q and a box so we can keep track of everything even after we end it. Uh, my name is Jeffrey Collins. I’m an account executive here at level set and primarily my day to day, um, is working with businesses like yours to help you get paid faster and not experience any payment problems along the way, and make sure that cash flow is not an issue for you and your business. Uh, truly the thing that I love the most about working at level set is exactly that and really everything we’re gonna focus on today and ultimately getting contractors and suppliers paid on their terms on every project. Um, I would like to give a quick overview on level set for those of you who may not be too familiar, or this is your first webinar, uh, just so you can kind of understand a little better what we do and why we do it.
Speaker 1 (02:31):
Um, so we all know that the construction industry presents all sorts of challenges and even more challenges when it comes to getting paid. So level set is here to help you get paid, um, and make sure that the process is efficient. So our lean rights management software really helps you not only to track your mechanics, lean deadlines, but also suggest next steps and any notices that may be required along the way. Uh, we verify job site information and really ultimately make sure that managing your lean rights and paperwork is easy for your team and not adding any additional steps or processes to your workflow. Um, ultimately, so you can focus on areas like growing the business and not having to worry about cash flow, which of course can keep us all up at night from time to time. Uh, we also do provide access to construction attorneys and other legal services, and we do have all kinds of resources on the website.
Speaker 1 (03:33):
Um, everything from contractor profiles, outlining payment histories, um, educational resources, a lot of guides. So I would definitely suggest, you know, spend a few minutes on the website when you have some time, um, and definitely dig around cuz there’s plenty of information. Um, and that about does it for my intro there. So I’ll just hop in and get started. Uh, really the first thing that we should know about Texas lean law again, is that it is extremely wild, very complex, and there’s a whole lot of red tape around this stuff. Uh, first and foremost, don’t be intimidated. You know, again, by the end of the webinar, you’re gonna be pretty well equipped with the tools and resources that you need, um, to not have any stress about this stuff and really just to get your lean rights in order. And really what we’re gonna be focusing on today is how to file a mechanics lie in Texas. What comes after that, and then also touch on a couple frequently asked questions and then I’ll have some time to address any of your one off questions or specifics about what you may be facing right now.
Speaker 1 (04:38):
So if you’re going unpaid on a construction project, first of all, don’t worry. Um, you’re clearly not alone. Slow payment is a major challenge for contractors all over the us, especially in Texas, uh, you know, nationally there’s 92% rate of contractors that don’t get paid on their terms, which is mind blowing. Um, nearly a billion dollars every year goes unpaid on construction projects and that’s to contractors, subcontractors suppliers, it’s a mess. Um, typically a mechanics lie may be just what you need to help with that payment problem and to help escalate that payment where it needs to go, which is getting you a check. Um, before you fill out a mechanics lean affidavit form in Texas, first of all, you’re gonna wanna make sure, um, that we’re safe and clear to actually file run. This is gonna be really important. Um, as Texas does have some pretty stressful lean laws and a set of requirements and prerequisites.
Speaker 1 (05:42):
Um, so you wanna consider a few things before you go file on a lie. Number one is the work covered and protected by lead laws. Uh, this is pretty cut and dry in most cases, although, uh, there is some gray areas, which of course we could touch on those one on one. Um, number two, did we meet all of our notice requirements? Uh, this is especially important for subcontractors as there are a lot of Texas monthly notices that have to go out. Uh, usually starting the second or third month that work was completed and unpaid for. Um, it just varies from project type between public private commercial, um, and things like that. But number three, if this project was on a homestead, which a lot of single owned properties in Texas, as you probably know, are considered a homestead. So if that is the case, did our GC properly execute the contract?
Speaker 1 (06:39):
Um, and if you are the GC was the contract filed with the county recorder to ensure that your lie rights are protected. Should you get to this point? Um, number four, pretty important. Are we within the filing deadline? Um, this also does change between a residential project and a commercial project, and this is gonna be the 15th day of the third month on a residential project. And it’s gonna be the 15th day on a fourth month for commercial projects. So not to be confused with the monthly notices, that would be one month prior. So now that those four main points on our checklist are complete. Um, there’s gonna be three major steps that we have to take to file and actually make sure that this lean is done accurately. So number one, we’re gonna wanna fill out our Texas affidavit lean form. Uh, Texas is very specific about the form that’s required to file a mechanics lie.
Speaker 1 (07:38):
So we wanna make sure that whatever form you’re using meets the county report’s requirements specific to where it’s being filed. So we’re gonna fill out our lean form, um, gotta make sure that it’s completed, that all of the details are accurate, and this is all the way to tracking down certain specifics, um, such as legal property descriptions, job address, um, if there’s any hidden owners or lenders involved on the projects, we want to make sure that all of this is accurate in creating a valid lean. Um, there are a few ways that you can go about this. Sometimes it can be found in a contract if you’re lucky, um, sometimes contractors will get this from their sales team, or if you’re lucky and you have a good relationship, sometimes it could be as simple as a phone call to the general contractor to get, um, the owners and lenders information, but there is often a catch like everything in life and whether or not doing that takes a ton of time and a ton of your resources.
Speaker 1 (08:41):
Sometimes it does sometimes it doesn’t. Um, did you know that if you’re just relying on other people’s paperwork and other people’s, um, I guess due diligence to make sure the information’s correct, there’s a 78% chance of having an incorrect, incomplete job information, um, effectively this can invalidate your lie rights and that is not what we want, nor is that what we need. So whatever time spent trying to protect those payments, um, if it’s not accurate and you’re not a hundred percent sure on it, pretty much all that work’s been done for nothing. And we’re still unprotected. Um, another perk though, here of doing lean right’s paperwork, using a software service is that it’s instant project research. So the verification process is actually kind of baked into the software if you will. Um, as far as time saving goes, it’s instant. You gotta love instant, especially when time is money.
Speaker 1 (09:39):
And we’re trying to get these things done. Uh, for those of you that don’t know, level set actually has the largest construction database globally. Um, and since we were acquired by Procore last September, our database has really just grown exponentially. Um, additionally to that, about 90% of county reporters, nationally report to level set. So not only are we able to run the documents and the information through a number of different platforms to ensure that that information is accurate and spot on, um, and really leaves, you know, no risk of invalidating those lean rights, but we also have a live team in office and they’re gonna go over every document, uh, whether it’s a payment demand, the lie being filed, everything in between to ensure that you guys are in the right place and that everything’s protected on the jobs. So after this, what do we do?
Speaker 1 (10:34):
We have our lean paperwork filed. We’re ready to go. Step two is actually filing the paperwork with the county. So once we have the correct information, we’re sure everything’s accurate. Our lean paperwork’s filled out. We have to take this to the Texas county clerk. Um, and we have to bring this affidavit to the county reporter in the county where the property was located, that we’re doing the job. So we pay the fee we spend <laugh>, you know, hopefully not entire day at the courthouse, we get our documents filed, uh, some counties you can eRecord documents like this. However, there are still a lot of counties that are, uh, somewhat in the stone age, if you will. And they want you to show up in person, they wanna spend an entire day with you and they wanna make sure that they may or may not be advising you properly on, uh, everything that needs to be done on the flip side level set kind of takes care of all that for you guys.
Speaker 1 (11:31):
Um, again, that’s really gonna circle us back to the accuracy and really ensuring that the paperwork and the claims are not only filled out accurately, but we wanna make sure they’re filed accurately incorrectly. And this is really gonna be of the utmost importance, uh, for the projects. So after filing almost done, but not quite finished, we gotta make sure, uh, pretty much everybody involved gets a copy of this lie. So, you know, probably one of the most important steps in filing a lien is sending notice not only to the general contractors, but to the property owners as well. So a certified copy of the lie affidavit has to be sent, um, always sent via certified mail and it cannot be sent any later than the fifth business day after you filed with the county. So this can be done at the same time. Um, you know, as soon as you file send out your notices or not notify the property owners, um, on the flip side of that, you can send out notice prior to going to the courthouse and get everything filed.
Speaker 1 (12:36):
Um, but again, this is all what level set takes care of for you guys. Um, something that we kind of touched on earlier is the monthly notices. Uh, we don’t wanna forget our monthly notices. So in the great state of Texas, we have something called Texas day, uh, which is on the 15th of each month. So on the 15th of each month, this is when all monthly notices are due, um, across the state of Texas. And you can kind of look at this as your reminder because we’re, uh, about three days out, Friday at 10:00 AM is the deadline for Texas monthly notices. Um, and just to have some clarity on that, for those of you that may not be familiar with this, or maybe you’ve received the monthly notice in the past, um, it’s really a crucial step and especially for a subcontractor, and this is what is going to ensure that your lie rights are even protected in the first place.
Speaker 1 (13:26):
So these notices say on a residential job have to be sent no later than the 15th day of the second month in which work was completed and went unpaid for. So you can almost look at this, uh, monthly notice as like a payment demand or a notice of intent to lean, but it’s an essential step in protecting those lean rights. So a notice that’s sent even one day late, you know, we sent it on the 16th, we think everything’s good. I mean, this can basically void out lean rights together. Um, and may have, you know, may as well, not even been sent in the first place, uh, worst case scenario, should that happen? If you do file a mechanics lie, it can be viewed, uh, from the court almost as a false lie. So should that happen? It can have some pretty negative repercussions. Um, I’d say worst case scenario, I’ve seen subcontractors and contractors get countersued, um, you know, depending on who you’re dealing with, they saw the threat of a lie.
Speaker 1 (14:29):
They think it’s invalid, whether it is or isn’t. Um, and you know, that can be a, a tough road to go down, um, should it end up in that position? So we wanna make sure if Texas notices are a requirement that we’re on top of that, that we’re sending those documents and we’re sending them before the 15th, you know, we don’t need to wait around until possibly too late to send. Um, so steps one through three are completed. Now we’ve sent copies, legally served, certified mail property owner, GC. Uh, what do we do now? The waiting game can kind of begin, um, in a sense if you will. So now we have a couple of steps, typically filing a lie. Should you get to that point, um, is gonna be enough to get the property owners to pay you, um, our research internally and externally shows that majority of mechanics lean, uh, once they get filed, they get paid and it’s usually pretty quick. Um, and doesn’t typically have any further collection or legal efforts that are needed. Um, but basically you’d have two options from here. If you don’t get paid, you’re gonna have to enforce or foreclose on that lie. Um, and option two, when you get paid, you’re gonna wanna make sure that we get the lean released properly and timely as well.
Speaker 1 (15:43):
So first we’ll talk about enforcing the lien, um, liens that have been filed in Texas do have a pretty long shelf life. Um, from the deadline, um, of filing lie, you have one year to foreclose on that or enforce a lie. Um, that timeframe just recently changed in the beginning of this year in January. Um, as you can imagine, if you enforce Alene, it does mean you’re gonna have to strap in to undergo, uh, a pretty much a full legal proceeding in most cases, um, sometimes, and especially depending on the dollar amount and what we’re trying to, you know, get paid for. We have to determine if there are enough resources and there is enough time to do this. Um, so what are the alternatives? Uh, a pretty powerful alternative is a notice of intent to foreclose. And you can look at this document kind of as like the final warning shot, uh, a shot that just skim the bow of the boat in a sense, and a notice of intent to foreclose is exactly that, uh, certified document essentially saying, this is your final warning.
Speaker 1 (16:48):
Uh, we’re protected. Our rights are secured. We have lean rights, you know, we’re not playing anymore. We’re gonna give you 10 days to, you know, make things right, get us the money we deserve. And if we don’t get that check, we’re gonna be forced to, you know, take legal action. And we’re ready to do that a lot of times. Um, if you get to that point of notice of intent to foreclose, you know, nobody wants to go to court, nobody wants to pay attorneys. Nobody wants to spend time in a courtroom and have a drawn out long legal process, especially when ultimately, you know, at the end of the day, they know they owe you this money, uh, as of January, if a claimant on a property, um, and the owner do agree to extend the deadline. This is also another option for you. This can simply be done by signing an agreements, um, has to be signed before the official foreclosure date, uh, occurs.
Speaker 1 (17:40):
So this would typically be like more of a one off situation. Uh, quick example, you know, say you have a property owner, times are tough. We all know that, uh, they’re trying to do right. They’re trying to set up payment plans with you. They’ve been making good faith payments, but they’re still a long way to go. Um, you know, I’d hate to see that deadline come and go and they know, Hey, lean deadlines pass kept, will blow on it. And then they quit answering the phone, quit making payments or whatever. So in a situation like that, uh, that would be time to maybe consider this as an option. You know, let’s extend the, the lean deadline. Uh, we’ll push it out another year. We’ll let you get back on track. Do whatever you have to do, make ends meet, get us paid, figure it out.
Speaker 1 (18:21):
So those are, uh, a couple of options there for enforcing our, for closing on the lean, um, option. Number two, of course, once a lean is satisfied is releasing that lean. So once a lean has been paid or the lean has been satisfied, uh, you know, to your standards, the lean has to be released. And this typically has to get done within 10 days of the lean being satisfied or another option. Um, the property owners or GCs will send a, uh, written, lean release request once the lien’s been satisfied. So what do we do here? And, you know, oftentimes homeowners, uh, property owners, lenders, general contractors, they want that lean to be released before they make payment, where on the opposite side of that subcontractors and suppliers, they want to get paid, uh, before they release that lie. So ultimately nobody wants to give up their leverage when this is all that we have left.
Speaker 1 (19:18):
Uh, so what do we do here? So without me giving legal advice and telling you how to operate, um, the most general answer that I can give is to never sign a lean release until you have the money in hand. Um, the best thing I can compare this to is like signing over a vehicle’s title before you have the cash for the vehicle, right? You’re never gonna sign over your title, give somebody the keys and say, okay, go put everything in your name. And, uh, I can’t wait to see you next week with my $10,000 and, uh, we’ll make this right, right. It’s almost like an even trade. Like, I’ll give you the keys and the title when you put that money in my hand, and we’ll do a, a quick switch at the same time. And in a sense, that’s how you kind of wanna look at the lean release. You know, once you sign that release the Lean’s off, the Lean’s gone, you don’t really have anything to stand on. So it can be a, a, a somewhat slippery slope. Um, you just wanna make sure that you don’t give up your leverage no matter what side you’re on.
Speaker 1 (20:16):
So a couple of things that level said does to, you know, ultimately just make these processes easier, um, in a nutshell is going to be, um, ensuring that all of the data and accuracy for the lean is correct. I know I mentioned it a little bit earlier, um, but just to kind of, you know, reiterate how important the accuracy is, um, something as simple as like a typo and an owner’s name, um, somebody misidentified, maybe it’s a commercial project and there’s multiple LLCs or corporations that own a property that, you know, we don’t even know who they are. They never leave their, uh, their lake house in Austin. Uh, we gotta notify them. They gotta be on this document. Uh, the property description, the address, you know, it’s property address is 1000, but we accidentally put 1001, this can really throw a stick in the spokes to say the least.
Speaker 1 (21:05):
So, in addition to the database that we mentioned earlier, kind of touched on our scout research team, but this is actually our probably most powerful asset, um, and team here at level set. And these are, you know, a live set of well trained eyes that are gonna go over each and every document prior to sending. And we wanna make sure that, you know, nothing goes, goes left out, right? We wanna make sure every I’s dotted, every T’s crossed. Um, this is again, everything from monthly notices to preliminary notices, all the way to lien and bond claims as well. Um, number two, we wanna make sure that those monthly notices are sent and they’re sent on time and they’re sent when they need to be sent. So we really work with you guys to automate those monthly notices, to make sure they’re sent and postmarked on the 15th of each month, uh, after work was completed and unpaid, and also going to track the next steps, whether it be for payment, escalation, or a lean claim, um, should it be time to file?
Speaker 1 (22:05):
So number three, um, level, set’s gonna track those deadlines and the suggested next steps. So please remember here, uh, level set isn’t in office tool, right? So it’s cloud based. You basically can get on anywhere you have internet, but it’s gonna have all of your jobs listed all of your next steps, all of your deadlines, and it’s gonna give you one place to track everything. So suggest the next steps, you know, could be as simple as, Hey, we’re at day 15 on net 15 terms. Uh, we haven’t gotten payment yet. What are we gonna do? Are we gonna wait another two weeks? Or do we wanna just click the mouse and send out a payment reminder, or maybe we need to be a little more aggressive and we need to send a payment demand, literally with the click of a mouse, you could send those documents out and make sure that, um, you’re good to go and everything’s in one place.
Speaker 1 (22:55):
And then lastly, um, probably my favorite part about level sets. And one of the most important features is going to be job radar, which is going to monitor, um, downstream flow of payment on all projects. And this is the subcontractor suppliers, vendors, pretty much everybody involved on the job. Um, and basically what job radar does is it gives you visibility into how other contractors are getting paid on projects. So this can also help you guys determine how aggressive you need to be when it does come time to escalate payment or leverage your lean rights. Uh, so say you’re on a project. You know, things have been going pretty smooth time to get payments. And you’ve gotten a couple of notifications periodically throughout the project that, Hey, we have three contractors that are, you know, past 60 days on payment. One of them’s filing a mechanics lie as we speak.
Speaker 1 (23:51):
Um, maybe we don’t wanna wait until day 30 to send out a payment demand. Maybe we need to send out a day 15, as soon as we hit our terms. That way payment doesn’t become a problem for us. As we know others on the project are already experiencing some problems. So with job radar, you literally get up to the minute notifications inside of the dashboard for each job. And then weekly, we will send you out an email to whoever your administrator is, uh, for the account. And it’s gonna have all of your projects listed and any type of ins and outs on the job, whether it’s standard business, like a preliminary notice or a monthly, uh, Texas monthly notice all the way to things like liens being filed, um, tax lie, bankruptcies and things like that. And it could really give you that visibility to know, Hey, um, you know, we don’t need to wait around here. We need to get aggressive, no hard feelings, it’s just business. And we need to get paid cuz we got bills and we got guys to pay and we got trucks to fill up with gas.
Speaker 1 (24:57):
So something I do like to touch on here, um, as well as our legal guard offerings, um, some of you may be in a position already where, Hey, you know, we’re at our wits end, we’ve had to file a mechanics lean. We don’t know what to do from here. Um, maybe we have a lien that’s already been filed and we’re a couple months into the process and nobody’s answering the phone. Nobody’s making any response. Um, legal guard is, uh, a really important piece of level set and it covers everything from proactive legal services, uh, to legal action when you guys need it. And they’ll also assist you with your lean services. Uh, proactive legal services is a pretty wide range of service, but we basically partner you, um, with a vetted construction attorney local to you in Texas. Um, as we all know, or as we’re learning, Texas does have some pretty complex laws.
Speaker 1 (25:48):
So having a trusted advisor, somebody that’s well informed on not only Texas lean rights, but construction as a whole, um, can really go a long way for you and the team. And this will cover everything from contractor reviews, whether they’re coming in or going out, um, insurance and bonding policies, reviews annually, uh, a whole lot more than that as well. Uh, legal action when you need it basically is gonna cover everything from phone consultations. I mean, you could have phone consultations with them weekly. If you just wanna have a chat about what’s going on and, and maybe get some advice for filing a lie. If you need a letter written on your behalf, uh, you know, a payment demand goes a, a really long way. And I will say a payment demand written from a construction attorney with a legal letterhead can oftentimes make much more of an impact, uh, as well.
Speaker 1 (26:38):
So that’s pretty nice. And then the lean services is basically everything from having your attorney, um, respond to a lien that may be filed against you. We know that a lot of times, if you’re having payment issues, it tends to roll downhill. So, um, you know, sometimes others sub tier contractors or suppliers may get to the point where they’re saying, Hey, we’re putting a lie on, on this project. You’re listed, you’re the hiring party. We, you know how to get around this situation. So they’re gonna be there for you. Um, and then also, should you have a lean, you know, that you need to file, they’re gonna make sure that everything gets recorded properly. Uh, they’ll advise you on the process. They’ll, you know, take you through the foreclosure process and basically be there at your Becking call throughout everything. And, uh, you know, just having an attorney, I don’t know if you guys have attorneys or partnerships, but uh, definitely goes a long way.
Speaker 1 (27:33):
Um, so here we go, guys, that about wraps up. I do wanna touch on a couple of these FAQs. Um, and again, I didn’t really focus on that QR code, but you’ll see it down here, um, in the corner, if you do have questions, um, you know, we don’t have time to answer them, please feel free to scan that QR code. We’ll set up a quick one on one, uh, presentation. Uh, but some of the frequently asked questions that I get, uh, regarding Texas, which we did cover most of this, but just to drive it home, number one, how are notices supposed to be sent 100% of the time certified mail? The documents have to be legally served to the property owners and to the general contractors. So using the us postal service, um, we’re gonna get a tracking number and for good measure, we’re also gonna send an electronic version and really just make sure that you have red receipts or delivery receipts for everything being sent.
Speaker 1 (28:26):
Um, number two is Texas considered service when the notice is sent or received. So the requirement to send most notices in Texas is gonna be fulfilled upon mailing. So as soon as we have the documents postmarked, um, you’re gonna be good to go. And that’s also why we have a 10:00 AM cutoff on the 15th for our monthly notices. Uh, we wait until the last minute, cuz should you get paid at 1159 on the 14th? We don’t wanna send these documents preemptively, um, or, you know, rub anybody the wrong way when you’re sending out a payment demand when you know, checks in hand. Um, lastly, what if I send a Texas lean notice late and again, to drive that home, if you fail to send a required monthly notice on time or we file our mechanics lie even one day too late, um, it’s pretty unlikely that you’ll ultimately be able to have a successful lie claim filed. Um, again, worst case scenario, we get a countersuit for filing a false lie and nobody needs that. And certainly nobody wants that. So I’m gonna hop in, um, to my Q and a. Now, hopefully that answered a lot of questions for you guys. Um, and as we, I know it was a kind of a lot of information. We, we sailed right through it. Um, but I’d like to hop on some of these questions. So I’m gonna look at my Q and a box here first.
Speaker 2 (29:54):
Speaker 1 (29:55):
Speaker 2 (29:56):
Real quick. Before we hit the Q and a box, we had one come through chat and I wanna address that one first, before we move over. Um, that question was if they give their clients 30 days to pay, does the clock start as soon as the project is finished or when the bill is due?
Speaker 1 (30:11):
So that’s a great question. Um, I see that there too, Sean, sorry. I missed that. Um, shock clock starts as soon as you finish work. So the last day on the job, whether you’re providing service, labor materials, doesn’t matter your last day on the job, that’s when the shock clock begins. Uh, we wanna make sure you know, that you are protected typically, um, 30 days can be, um, enough, however, depending on if it’s a residential project or a commercial project, uh, you know, that timeline really changes because it’s the 15th day of the second month after work was completed and unpaid. So, you know, if we did any work in, you know, July say we do work, it doesn’t matter if it’s the first or the 25th doesn’t matter work was in July. We have until September 15th to get paid. So say work was completed, you know, July 30th.
Speaker 1 (31:05):
So if we give them until August 30th, that’s our 30 day window. Now we only have 15 days to send out our first payment demand or Texas monthly notice. So, you know, net 30 is great. We just wanna make sure that, you know, those deadlines are tracked really as pinpoint as possible. And as soon as they go past day 30, uh, you know, we wanna make sure that action ready to be taken. So I hope that answers your question there, Sean, and we can, uh, certainly spend some more time discussing that and a one-on-one if you are having some payments that are, uh, you know, sticking out past that 30 day, um, let me hop in here to my Q and a box. Uh, let’s see, on our anonymous attendee notices sent out on the 15th, uh, for work completed and unpaid is that completion of the contract or for work completed.
Speaker 1 (31:54):
Okay. We already got that one answered to let’s see, how do you extend the deadline that I just mentioned, um, to extend the deadline. We do have some documents on the, um, on the website and I can have those sent over for you. Um, Kiana. She may have something too that she can send over for you. Um, but the best thing to do, scan that QR code and try to link up cuz the website does have a ton of information. I wanna be able to get that kind of straight over for you. Uh, but it is a required document. It doesn’t typically have to be filed with the county or anything like that, but oftentimes we’ll need to be notarized. Uh, let’s go down a little more. Blake, why would you wanna give notice before you file the lien? Great question, Blake. Um, part of the reason you want to give notice to file the lien because once the lien is filed, it’s a long road, uh, sometimes to get paid.
Speaker 1 (32:49):
So, you know, ultimately Blake contracts are great. Um, you know, they can really help set payment expectations. They can define payment terms and guidelines. However, when you get to the end of the, the job or the end of the contract and payment goes past those terms, you know, technically you’ve already voided the contract, right? It’s breached. Now the only way to really settle something like that is gonna be in the courtroom. It’s cons you know, more than just construction law. At that point, it’s business law contract law, it’s a legal battle. It’s gonna have uncertain outcomes and uh, you know, be pretty costly and timely for that matter as well. Whereas, you know, just the threat of a lie in a lot of cases can be the warning shot that you need to escalate payment and get you the check that you deserve. And sometimes it can be as simple as visibility on a project.
Speaker 1 (33:39):
Um, you know, say you’re a subcontractor and a, General’s not paying you. You know, when these property owners and people in the office that never actually see a job site, you know, they don’t know who’s on the job. They don’t know who you are. They don’t know what you’re doing on the project. And when they pay that general contractor, they’re expecting them to make payments downstream and to have everybody settled up. So a lot of times when you send that notice and give that warning and it goes to the property owners, it goes to the lenders, it goes to everybody up the pay chain that can be enough sometimes. And a lot of cases to leverage those lean rights and to get you that check that you deserve, or at least leverage the relationships against each other, between GC and property owner. Um, you know, in a lot of instances, GCs are saying, oh, I haven’t got a check yet, but as soon as the property owner gets that legal document and a certified letter saying, Hey, if I don’t get a check, I’m gonna lean this property.
Speaker 1 (34:33):
They’re gonna get on the phone with you pretty quick and say, Hey, we actually paid Bob’s general contracting company. Uh, we don’t know what’s going on, but it’s gonna really help them kind of turn into your collector for you because they don’t wanna lean on their property. Hope that answered that for you, Blake. And let’s see here, Christopher’s got a couple questions. Um, I don’t know if you guys can see the questions, but it says, what if a lie is filed on time, then additional amounts was not included yet on the filed lean and the demand letter is sent G still GC still won’t pay. Um, you know, there’s a couple of different ways to go about that. Christopher, um, number one most effective would certainly be foreclosing on that lie. Um, number two, I’d say, did you properly send that document to the property owners?
Speaker 1 (35:23):
Cause a lot of times when the GC still won’t pay the lie, the, or I’m sorry, the general contractor gets notified about the lien on the property, but the lie goes to the property. It doesn’t actually go with the GC. So sometimes when a lien’s filed or even a threat or a warning is sent and it only gets sent to the GC, it’s still not going to leverage or give you guys the leverage that you need. Ultimately you have to let everybody involved, know the situation. So that’s, what’s gonna ultimately escalate that payment. Um, if they still won’t pay maybe time to talk about legal guard and get you in that direction. Let’s see. Part two to your question here, Christopher, is there a chance to, is there a chance to amend the amount placed on the lien to add the remaining invoice if it’s almost a year typically?
Speaker 1 (36:08):
No. Um, once the lien is filed, that’s kind of its um, depending on the months that the lie was for, you may be able to file a second lien on the property or on the project. Um, say it was, you know, covering everything up until this month, but then you kept working on the project for another couple of months and realized that, you know, nothing was getting satisfied that would constitute in most cases. Um, another mechanics lien, let me see here, Yolanda. Let’s see. Will I be able to get a copy of the webinar recording? Yes, ma’am you will. Um, we’re gonna send that out to you. Let’s see if you use your boss’s link. Um, they’ll probably get the email, but I can send that over for you as well. Uh, let’s see the link didn’t open for 30 minutes. I’m so sorry about that.
Speaker 1 (36:51):
Um, I’ll make sure to catch up with you here though, after, and we’ll get that sent over for you. Let’s see. As a general contractor does work perform prior to any given notice deadline each month still get covered by lean rights. If I continue to work and perform other more recent work in the current notice period, in other words, is the notice period specifically, sorry, specific only for the most recent work perform. Uh, those monthly notices do get updated every month. So, um, if work extends past 2, 3, 4, 5, 6 months, um, you’re gonna have to start in those notices on the 15th day of the second month, and then there’s gonna be a new monthly notice sent out for the third month. That’s gonna cover the second month, the fourth month, which is gonna cover the third month and so on and so forth. Um, and should you need to file lean?
Speaker 1 (37:39):
You can kind of incorporate all of those, um, into one, into one lean document, but there will need to be a separate notice for each of them. Christopher. Yes. Property owner got notified. Uh, Christopher Best thing I could recommend is scan that QR code and, uh, let’s have a, a one-on-one because it’s gonna be a little more pertinent for you. Um, I do have some info that I can share with you, but I think we’ll be best to do that kind of in a one-on-one setting, if that’s good for you, or if you can carve out a few minutes to, to hang out after, um, Steve real quick, sorry to have missed your question there at the top, does a constitutional lean require a written contract. So I’m gonna pull over my cheat sheet for Texas because it can kind of vary. Um, in most cases it’s almost somewhat unclear if Texas requires a written contract.
Speaker 1 (38:27):
Um, a lot of times they can be, um, just a, a handshake or a verbal deal, but I’m gonna pull up gimme just a second. Okay. Let’s see. So parties who contract directly with the property owner in Texas can file a constitutional lien. Um, there are no notice or filing requirements for a constitutional lien, but the claimants must meet specific requirements. Um, I can go through all of those requirements, but it may be best, same thing to have a quick one off, or what I can do also is send a link in the chat here. I’ll send it to everybody, and this is gonna bring you to a Texas FAQ. So that should help you. And right under the very first section, there’s gonna be a link that says, are you eligible to file a mechanics lean in Texas? Um, that’s gonna have some more institution, uh, sorry. More information about a constitutional lie for you.
Speaker 1 (39:22):
Let’s see. I think I got most of those answered, um, from the Q and a. I’m gonna try to check through the chat here. Um, also too, I just want to thank everybody for coming today. I know we ran, um, a couple of minutes over, especially with our Q and a here at the ends. Um, you know, I know it was a lot of information to take in, but I’m gonna make sure too, that I have that QR code up for you. Um, you know, can’t suggest enough schedule on a quick call if you guys would like to actually demo level set and how we can get through this and how we can streamline a lot of these processes to ultimately avoid filing leads, to get paid. Uh, please scan that QR code. I can tailor that down to, you know, specifically your needs and uh, and what’s gonna help you guys move in the right direction from here on out.
Speaker 1 (40:11):
Let’s see Christine, I’ll see your question here. So we’ll continue to send out notices each month, but the panic lie cannot be filed until the 15th of the fourth month after completion of the contract. That would be correct. Um, Christine, it’s gonna be the fourth month on a commercial project and it’s gonna be the third month on a residential project. And don’t forget if you do like multifamily housing or anything like that, apartment complexes, uh, that’s gonna be considered commercial as well. Thank you, Julie. I hope you have a great day too. I’m glad you, uh, enjoyed the information. Hopefully it, uh, had some impact for you. It can, can help you guys iron out some of these issues you might be facing.
Speaker 1 (40:59):
Yes, Laura, great question. Our legal guard attorneys board certified in construction law. They are all 100% board certified they’re primary and only focus is construction law. Um, just to be clear on that a little bit more about legal guard, um, this isn’t quite like legal zoom or one of those kind of fly by night legal services where you call a one 800 number, um, and they give you some civil attorney that, you know, wrote your grandmother’s will in 1994. Um, you know, these are construction attorneys. They have the information that you need. They have the backing that you need. Um, also too, just to touch there, Laura, even further, they don’t work exclusively for level set. Um, our legal guard attorneys have a partnership with level sets. Uh, we kind of go over all those details, um, when you’re ready to kind of get on board with something like that. Um, but it’s a, it’s an attorney partnership. So depending on their workload, you know, a lot of them have pretty big construction law firms. They have other cases going on, uh, but that is their only, and their primary focus, construction law. Great question, Laura.
Speaker 1 (42:08):
Thank you, Christopher. Glad you made it today. Um, you know, I look forward to talking with everybody after this, you know, we got tons more information. I know this was kind of a broad, uh, visit today just about following the lean, but you know, certainly if you’re just having some paving issues and trying to, uh, to get these balls rolling and get things moving in the right place, we’re here for you. And we’re happy to, uh, to talk about some best practices and how we help thousands of other contractors with this stuff every day. I’ll give this a few more minutes here, guys. See if any more questions come in. I see a couple of y’all still, um, on the zoom meeting here, so let’s see, we’ll give it to one 50 central time before we end this.
Speaker 1 (42:52):
And if you guys are trying to, uh, scan that QR code and having any issues, just raise a hand and I’ll kind of go over that again, but you should just be able to open up your camera hover over that, uh, black and white QR code there in the corner, click, uh, schedule appointment. It should bring you straight to the link, put in your info and I’ll be touching base with you here soon. Thanks Jane. Thanks Virginia. Hope you have a great afternoon as well. Hey, Laura, I am able to, uh, to be contacted directly. If you scan that code too, I will be the one to follow up with you after. Um, in the meantime, I’m going to put my cell phone number here in the chat and also my email address. So I will have, um, I’ll have time throughout the rest of the day to day to, to touch base with you or, or reconnect. However, if you do gimme a call right now, um, my next, usually 20 to 30 minutes after this are a little hectic, um, as you probably can see why, uh, but shoot me an email. You can text me, you can gimme a call. If I can’t answer, just leave me a message and I’ll give you a call right back, Laura, my link didn’t show up. So sorry about that. Let me try again. Give me a second here.
Speaker 1 (44:47):
Did you get at that time, Laura, if not, um, let’s see. Oh, you can’t see my email, my cell phone either. Let’s see. Hopefully it’s working this time. I, I can just verbally say it as well. My cell phone. Um, perfect. Now you can see the link, sorry. I must have had the wrong, uh, the wrong option selected there. There’s my cell phone and email coming through now. Thanks for letting me know about that, Laura. Perfect. And I hope I’m saying it right Laura and not Laura and I had a awesome, I had a friend growing up and her name was Laura and she spelled at L a R a and I will never forget, uh, the pain that she would inflict emotionally and immensely. If you called her Laura by mistake. Glad I got it right. All right guys. Well, it’s one 50 here. Um, again, I know there’s only a few of us left, but I wanna just thank y’all again for, uh, well, I’m glad I got it right, Laura. Uh, I just wanna thank y’all again. Uh, you know, look forward to talking with y’all here in the future. Please feel free to reach out if we can be of assistance. And, uh, I hope y’all have a great rest of your week.