What to Do When a Contractor or Owner Does Not Pay

If a contractor or owner is not paying you, check your contract and your lien deadline first. Then escalate in order: a demand letter, a notice of intent to lien, the lien itself, and a suit to enforce it. Each step adds pressure and each has its own clock, so start counting from your last day on the job today.

Check your contract and start the deadline clock

Before you send anything, pull the contract. Look for:

• Payment terms. When each payment was due, and whether you sent the invoices or pay applications it requires.
• Pay-if-paid or pay-when-paid clauses. These tie your payment to the contractor getting paid. Whether a court will enforce one varies by state, so confirm with counsel.
• Dispute clauses. Arbitration, notice-of-claim or venue terms can change where and how you can sue.

Next, check whether a statute already gives you rights. Texas, for example, requires a contractor to pay its subcontractor within 7 days after the owner pays, and unpaid amounts bear interest at 1.5 percent a month (Tex. Prop. Code §§ 28.002, 28.004).

Then start the clock. Your last furnishing date is the last day you performed work or delivered materials on the job. Most lien deadlines count from it. Some notices are due much earlier. A California preliminary notice is due within 20 days after you first furnish work (Cal. Civ. Code § 8204). A Texas subcontractor sends a notice of claim for each unpaid month (Tex. Prop. Code § 53.056). Put your dates into the lien deadline calculator and look up your state's lien rules.

Send a payment demand letter

A demand letter is a written request for a specific amount by a specific date. It is often enough. It shows you are organized, it fixes the amount in writing, and it gives the other side a clean chance to pay.

Include the job name and address, what you furnished, the invoices that are unpaid, the total owed after credits, and a short pay-by date. Say what you will do next if you are not paid, such as file a lien. Send it to whoever hired you, and copy the owner if your state allows a lien against the property. Keep proof of the date you sent it.

The pay-by date must leave room for the next steps. A demand letter does not pause any lien deadline. eRegister's payment demand letter is drafted and mailed for $49.

Send a notice of intent to lien

A notice of intent to lien warns the owner that you will file a lien by a stated date. In some states it is required before you can file. Colorado requires one at least ten days before the lien statement is filed (C.R.S. § 38-22-109(3)). Pennsylvania requires a subcontractor to give the owner formal notice at least 30 days before filing (49 P.S. § 1501).

In other states it is optional, but it reaches the owner directly. Owners often pay, or push the contractor to pay, to keep a lien off their title. See notice of intent to lien explained for the states that require one, or use the notice of intent service.

File the mechanics lien

A mechanics lien is a claim against the property that secures what you are owed for improving it. File it before your state's deadline, even if talks are still going. In Florida that is no later than 90 days after your final furnishing (Fla. Stat. § 713.08(5)). In Texas it is the 15th day of the 4th month after the month you last furnished (Tex. Prop. Code § 53.052).

Claim only what you are owed. In Washington, a court can release a frivolous or clearly excessive lien and order you to pay the other side's attorney fees (RCW 60.04.081). Our guide on how to file a mechanics lien covers the claim, recording and service.

Enforce the lien before it expires

If the lien does not bring payment, you must sue to foreclose it within the statute's window. California gives you 90 days after recording (Cal. Civ. Code § 8460). Florida gives you one year, but an owner can record a notice of contest that cuts your time to 60 days after service (Fla. Stat. § 713.22). Texas allows until the first anniversary of the last day you could have filed (§ 53.158).

On public work you cannot lien the property. On a federal job you claim on the prime contractor's payment bond under the Miller Act. A supplier or subcontractor hired by a subcontractor must give the prime written notice within 90 days after its last work or materials, and any suit is due within one year (40 U.S.C. § 3133).

What each step costs you in time

When to bring in counsel

You can handle the letter, the notice and, in most states, the lien yourself. Bring in counsel when:

• You need to sue. Enforcing a lien is a lawsuit. In Maryland even establishing the lien takes a petition in circuit court (Md. Code, Real Prop. § 9-105).
• The work is disputed. Quality or change-order disputes shape what amount you can safely claim.
• Fees can shift. In Florida, the prevailing party in a lien suit recovers attorney fees (Fla. Stat. § 713.29). Losing can cost more than the claim.
• The contract has an arbitration clause or the claim is large.

Whatever you do, do not let talks run past a deadline. A promise to pay next week does not extend your lien rights. Check your state's lien page for the exact dates and start the next step on time.