Video Transcript:
So what is a mechanics lien and how does it affect real estate title? This is Dave at TitleSearch.com, Certified Title Abstractors. A mechanics lien is a powerful method of encumbering a property to ensure payment for repairs, maintenance, or upgrades to a piece of real estate. It's something that actually can go either way. You may have a mechanics lien that actually doesn't show on title but still affects the property. You may also have a mechanics lien that shows up on a title search but no longer affects the property. And the reason for that is: mechanics liens in different states and even different counties have a wide range of requirements and very specific legal aspects going into how that lien is recorded and how it encumbers the property. For example, in some states, a mechanics lien has to be physically recorded by document on the property within a certain period of time after the work is done or materials are delivered. Could be six months, could be a year. And then there may be another trigger that it has to actually be acted upon within a certain period of time. In most states, a mechanics lien attaches by statute -meaning that in a very short period of time after work is done on a property, there is no requirement for a paper recording. In some cases, if the person does work on a property or delivers material, they automatically have a mechanics lien until that is paid for. So if you're looking at a piece of real estate and you run a title search and everything looks clean, there may be still mechanics lien rights attached to that property. And a good way to determine that is seeing if there's evidence of recent construction on the property, maybe checking permits in the permit and zoning office, discovering if there are any alterations to even ground disturbances, whether it was digging or it looks like there was some other types of construction. At the same time, if you do see a mechanics lien on the title report, you can also look to see if it is still valid. Some mechanics liens will automatically expire after some period of time. It's important to note that the priority of a mechanics lien over other encumbrances sometimes jumps around. It's not necessarily by time. It's not necessarily by recording date. Sometimes a mechanics lien just jumps to the front of the line because they're afforded more priority by the statute. If you do have questions about running a title search on real estate, you can reach us at our website at title search dot com.