Overview of Ohio’s mechanic’s lien laws

On Behalf of | Dec 4, 2020 | Real estate litigation |

Like other states, Ohio has laws that protect contractors, subcontractors and others who build or improve homes, buildings and other real estate.

These laws, often referred to as mechanic’s liens, are important safeguards in the construction industry.  They protect the industry against investing materials and labor in a project only not to get paid.

Indirectly, they also protect customers because they induce builders and contractors to take a chance on a project without insisting on payment in full and up front.

Mechanic’s liens are powerful legal weapons in builders’ pockets

In Ohio, a mechanic’s lien is a powerful legal weapon.

A contractor or subcontractor who is entitled to and properly records a lien effectively clouds the title to the property, even if the property owner is not at fault for not paying. In fact, the owner may have no idea about the mechanic’s lien when he or she buys the property.

When negotiation fails, the contractor can force the sale of the property in a foreclosure to get paid for its work.

But mechanic’s liens are often the source of litigation

However, there are strict rules that a person or business entitled to a lien must observe throughout the recording and foreclosure process.

If the person does not follow these rules, the person could forfeit the right to a lien and, moreover, be left without any viable means of collecting payment for work performed.

On the other hand, many residents of the Toledo area might have a mechanic’s lien recorded against their property fairly. In some cases, they may need to pursue the person who is truly responsible for paying the contractor. In other cases, they may have a counterclaim for incomplete or unsatisfactory work.

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