Protect Your Home and Finances from Mechanic’s Liens
You’ve just completed a major home renovation or car repair, but there’s a problem: a mechanic’s lien has been placed against your property. What does this mean for your financial future? And if bankruptcy is on the table, how does that affect the lien?
Mechanic’s liens can create significant challenges for homeowners and vehicle owners, but understanding how they work—and how bankruptcy impacts them—can make all the difference.
Let’s dive into what mechanic’s liens are, how they’re enforced in Kansas and Missouri, and what happens to them during bankruptcy.
What Is a Mechanic’s Lien?
The Basics of Mechanic’s Liens
A mechanic’s lien is a legal claim placed on a property to ensure payment for labor, services, or materials provided.
- Commonly filed by subcontractors, contractors, or suppliers.
- Can apply to homes, other real estate, or vehicles.
- Allows unpaid workers to seek repayment by securing the debt against the property.
How Mechanic’s Liens Affect Homeowners
Even if you’ve paid your general contractor, you could still be responsible if a subcontractor isn’t paid.
- Subcontractors and suppliers have the legal right to file a lien directly against your property.
- Mechanic’s liens often take priority over other debts, making them difficult to ignore.
Mechanic’s Lien Laws in Kansas and Missouri
Kansas Mechanic’s Lien Laws
Kansas has strict guidelines for mechanic’s liens:
- Eligible Filers: Contractors, subcontractors, and suppliers who provided labor or materials directly related to the project.
- Deadlines:
- Contractors: Must file within four months of the last day of work.
- Subcontractors: Must file within three months of the contractor’s last work date.
Missouri Mechanic’s Lien Laws
Missouri’s laws broaden eligibility but maintain strict filing deadlines:
- Eligible Filers: Includes general contractors, subcontractors, suppliers, equipment lessors, and even landscapers.
- Deadlines:
- Most liens: Must be filed within six months of the last labor date.
- Equipment lessors: Must file within 60 days of equipment removal.
Can You Discharge a Mechanic’s Lien in Bankruptcy?
Mechanic’s Liens as Secured Debt
Mechanic’s liens are generally treated as secured debt during bankruptcy. This means they are tied to specific property and may not be discharged unless certain conditions are met.
Perfected vs. Unperfected Liens
The status of the lien determines whether it can be discharged:
- Perfected Liens: Properly recorded and legally enforceable. These liens typically survive bankruptcy.
- Unperfected Liens: Improperly filed or recorded. These may be treated as unsecured debt and discharged in bankruptcy.
Chapter 7 vs. Chapter 13 Bankruptcy
- Chapter 7 Bankruptcy:
- Perfected liens remain in place.
- Payments must be made eventually, often after other debts are resolved.
- Chapter 13 Bankruptcy:
- Offers the possibility of reducing lien amounts.
- Payments are reorganized into a repayment plan, potentially lowering the financial burden.
How to Avoid Mechanic’s Liens as a Homeowner
Steps to Protect Yourself
Prevent mechanic’s liens by taking proactive steps during any construction or repair project:
- Pay with Joint Checks: Write checks made out to both the contractor and subcontractor to ensure everyone gets paid.
- Request Lien Waivers: Include a clause in your contract requiring lien waivers from all subcontractors.
- Verify Payments: Ask for proof that subcontractors and suppliers have been paid before making your final payment.
What If a Lien Is Filed?
If a lien has already been placed against your property:
- Act quickly to verify its legitimacy.
- Work with an attorney to negotiate payment or dispute invalid claims.
Take Control of Mechanic’s Liens During Bankruptcy
Mechanic’s liens can complicate an already challenging financial situation, especially if you’re considering bankruptcy. Whether you’re dealing with a lien on your home or vehicle, consulting an experienced bankruptcy attorney is critical. They can help you understand your options, protect your rights, and minimize financial losses.
Don’t let mechanic’s liens or financial stress overwhelm you. Take the first step toward a fresh financial start. Contact us today for a free consultation with our experienced bankruptcy attorneys. We’ll help you explore your options and create a plan to protect your property and future.
Schedule your consultation now.
