The name of these documents should give away most of the answer, but still it can be confusing to distinguish these two documents and figure out which is the best for your particular situation. It certainly doesn’t help that each state calls the “mechanics lien” by a different moniker, and sometimes the names of these documents look pretty similar to the notice of intent document, such as the states that call the lien document a “Notice of Lien Claim” or “Notice of Claim.”
What’s the difference between these two documents anyway?
Comparing The Mechanics Lien and the Notice of Intent to Lien
The mechanics lien and the notice of intent to lien documents are unique and independent from one another. Very much so. This section will discuss each of the documents separately, and end with a chart comparing the two in some key areas.
Notice of Intent to Lien
A Notice of Intent to Lien can be sent at anytime for any project in the United States when you’re unpaid for labor or materials furnished, but is only required to be sent in a handful of states. Too many companies mistakenly think they must send a notice of intent to lien before filing a mechanics lien in states where the document is not required, but there is no harm in sending the document even in those states.
The notice of intent to lien document is partially a warning notice and partially a demand letter. The letter warns the property owner, prime contractor or other interested party that a mechanics lien will be filed in the immediate future if payment is not paid to the unpaid party. The letter usually gives these parties between 10-30 days to make payment. The letter also makes formal demand upon the interested parties for payment, saying something along the lines of “…if payment is not received within 10 days, we will move to file a mechanics lien against the project.”
The notice of intent to lien is typically sent or served upon the parties, and is not filed. The notice of intent to lien does not bestow any rights upon the party sending it, and it does not impact the property in any way. It is only a warning to do these things if payment is not received.
The Mechanics Lien document is available in every state, and it is a more formal document. This document is actually filed with a county recorder and impacts the property where the project is located. It is not a warning, and it is not a demand. This is a legal instrument that has legal consequences to the property owner’s rights in the property.
Unlike the notice of intent to lien, the mechanics lien must be filed in every state to perfect a party’s lien rights. Further, it must be filed within a certain period of time. While anyone can send a notice of intent to lien regardless of whether it is required or not, one must be careful to not blow through their lien deadline because they were concerned with sending a voluntary or unneeded notice of intent to lien document.
Chart Comparing The Notice of Intent to Lien and Mechanics Lien Documents
Here is a chart comparing the differences between a Notice of Intent to Lien and a Mechanics Lien in some key areas.
|Issue||Mechanics Lien||Notice of Intent|
|Is A Required Document?||YES||Only Sometimes|
|Must Be Filed With the Recorder’s Office?||YES||NO|
|Must meet formatting, margin and specific technical requirements?||YES||Usually Not.|
|Must be formally served on certain parties?||Usually||Usually Not|
|Perfects your lien claim?||YES||NO|
|Needs a Legal Description?||YES||Usually Not|