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What is a Lien and how to perfect them

MR. SANDBERG: Hi, my name is Jens Sandberg and I'm an associate attorney here with the Vethan Law Firm. And today as a part of the Vethan Law Firms Video Education Series, we are going to talk about liens and how to perfect them. In Texas there is two types of liens. There's a statutory lien that goes onto the property and then there's also a lien on the retainage. So what's the difference? The lien on the property is for the amount of work that you have already performed or the amount of work that is owed to you. A lien on the retainage is a lien on the amount that has been retained on the contract by the owner. So what are the steps that you need to take to perfect the lien? There is three things you need to do. First, you need to send a letter to the general contractor and to the owner stating that you are going to file a lien. And you need to send this within 45 days of when you finish your work. So if you finish your work ln December, you will have until mid February to send that letter to the general contractor and owner. And basically in that letter you're saying, I'm owed this amount of money and if you don't pay me within this timeframe, I'm going to file a lien. So now let's go into what is the actual lien? A lien is an affidavit. It's a sworn statement saying this is what I'm owed. This is the work that I've done. I've complied with all of the other statutory requirements including sending that letter, and ultimately you have to write that down and put it on paper in a lien affidavit. Now this lien affidavit is filed with the real property records of whatever your local county is and this gives the public the opportunity to look and find, you know, what kind of encumbrances are on that property. Now, if you wish to finalize and perfect that lien, you need to send a letter after you file the lien within five days to the general contractor and owner basically saying: Hey, I gave you an opportunity to pay off whatever amount is owed, and you didn't pay it so I filed a lien on your property. So why is this important? Because if you don't follow those three steps, you lose your lien. You have to send the letter first. You have to file the affidavit and then you have to send the letter and the affidavit to the owner and general contractor afterwards. And if you don't, you lose your right and that security of that amount that you're owed is no longer there. So, if you're owed money or if you believe that a lien has been filed against you and it's not correct, give us a call. Because at the Vethan Law Firm, your problem is our business.