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Hire a preliminary lien Service company that will PERFECT and PROTECT your MECHANIC'S LIEN and BOND CLAIM RIGHTS.

Read here about what to look for when checking out a preliminary lien service.

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Consider hiring a preliminary lien service that researches, perfects and protects your mechanic's lien rights for you. What's neat about these companies is they already have in place the resources needed to verify the information you provide and if they find something incorrect, they correct it.

If you don't have the time to devote to researching construction trust deeds and such (verification processes are very time consuming and expensive), then using a preliminary lien service company to protect your lien and bond claim rights may be just the ticket for you.

Normally, it's set up so that you pay a fee for their service plus all postage expenses. Because the agency is focused on filing preliminary notices as their business, they can usually do it at a much lower cost than you can do it yourself.

What about mistakes?

Ask your potential provider what happens if they make a mistake, be it in their research, or a typo, or not tracking receipt of the notices, or whatever mistake they make.

If your service provider makes a mistake and doesn't prelim the correct entities, and then the job runs into problems and you don't get paid, and you can't file a lien because the California 20-Day preliminary notice was processed incorrectly by your service provider, will your service provider make good on their mistake(s)! (meaning: will they pay you what you lost due to their mistakes?)

The first time I used a preliminary lien notice service company, I had a huge shock. I sent the job info to them, including contact information for the two parties that needed to be "prelim'd" on the project. This was information that the General Contractor on the job had provided to us.

Imagine my surprise when they came back with FIVE different financially involved entites on the project!

All five of these entities had to be prelim'd, and if they had not been, we could have ended up in trouble and without lien rights.

Plus, in California, a subcontractor can face disciplinary action for not serving a preliminary notice!!

Without the preliminary lien service provider, we very well may have found ourselves in trouble with the law (not to mention we'd have lost our lien rights)!

* What does it cost to process a preliminary notice?

* Is the fee per notice (ie: 5 entities incurs 5 times the price) or per project (lump sum no matter how many entities)?

* How are the postage fees handled?

When doing the preliminary notices myself it would take me a minimum of 2 hours just to do all the paperwork and that doesn't include any of my research time spent making sure I was serving the right people. If you include that time as well we could be looking at potentially 5+ hours depending on the scope of the project, the number of folks that have to be prelim'd, etc.

At $20 per hour that would be $100 for one project AND I wouldn't ever be absolutely 100% certain that I was preliming all of the parties that needed to be.

When using the preliminary lien notice service I would pay less than that to have them not only process the paperwork but also to research & process the notice (no matter how many entities need to receive a copy). They have many more resources at their fingertips than I do because this is what they do, preliminary notices.When I did it myself, it would take me a minimum of two hours to process the notice.

A plus with using a preliminary lien service agency is that you may have access to a free consultation with an attorney (if the agency has this benefit available), should you run into problems on the job, such as someone not paying you.

There are several ways to process your California 20-Day preliminary notices; only you can decide which works best for you. For those times that you choose to process the preliminary notice yourself, the next page (5) consists of an outline of how we handled our preliminary notices whenever we didn't use our service provider.

(Please note that we are NOT necessarily recommending that you manage the prelim notices yourself. It's your choice how you do it but do consider a reputable preliminary lien service company. At least check them out and compare what it would cost to have them do it vs. what it costs to do it yourself.)

Diane

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