# File Lien or Lawsuit for non payment?



## ssroofpros (Jan 22, 2011)

Need some advise fellas...kind of stuck on this one. 
We got her insurance claim approved back in August, and proceeded with the replacement in Sept. The roof was satisfactorily completed, same day, on 9/14/11 and homeowner signed the completion certificate upon completion. 
Upon completion, she signed the completion certificate and paid us the 1st check (Actual Cash Value (ACV))...once recovered, she would pay the remaining balance for the job. That week, we submitted all documentation necessary for the insurance co. to release her withheld depreciation, so she could pay us in full. 
On October 23rd she emailed me stating the mortgage wanted customary documents filled out and submitted prior to endorsing the 2nd check, and that she would call me that next day...haven't heard anything from her, nor have I been able to contact her since receipt of that email (10/20/11)!? 

Soo, the remaining balance owed is around $2,500.00 & change. What would be my next step? Should I file suit, or mechanic lien...? In my state, we have 3 months, not 90 calendar days, from the project completion date to file lien...that's only a few days from now, so if that's best I need to jump on it asap. Although I have heard that a lien is trouble and payment takes forever? Where if I file suit a judgement might be taken as a more aggressive/serious action, I think...therefor expediting payment in full.? 
I haven't had to deal with a client not paying me thus far, thank goodness...so I'm not sure what to do, or where to start? Any advise is helpful at this point!

Thanks in advance for any advice y'all may have for me!


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## packer_rich (Dec 27, 2009)

The first thing I would do is send an email and registered letter to the HO. Then if you waited this long and are almost out of time, I would file the lien. Also send registered letters, from your attorney, to all parties involved. If you contact everyone, you will probably get a response from one of the parties. I think the insurance company would be interested to know the HO is keeping the money and not paying for the work performed.


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## Joasis (Mar 28, 2006)

In Oklahoma, the intent to lien has to be filed within 75 days, and then the lien as soon as practical, and where most fail with a lien is by not having a lawyer move it to foreclosure. Anyone can do small claims, and file liens, but the next step is tricky..and unless compelled for a reason to do so, a lien will be ignored, and then you have to re-file it every year. I am owed about $5k on materials and a roll-off fee for a remodel job that went south.....thankfully, we stopped work when we saw the guy was going to be problematic. Anyway, I filed a lien his property, and next week, the attorney will file a foreclosure on that lien. He could have paid the material bill, and I would have gladly ate the labor...now it will be in excess of $12,000 for being stupid. 

A lesson I learned was to begin doing background checks....I found he is no stranger to court...and he has lost many times...but still hasn't learned to pay his obligations yet.


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## BrandConst (May 9, 2011)

Lien and get a judgement.


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## thom (Nov 3, 2006)

A lien is merely public notice of an outstanding claim against a piece of property. A mortgage is also a lien. 

You don't collect on a lien though it may intimidate the owner into paying. 

A lawsuit is required to prove the legal obligation of the debt which then makes forced collection/payment possible. Prevailing in a suit on a lien gives you the right to have the property auctioned off to satisfy your claim. Of course, payment from the proceeds of the sale go in order of the lien filings. A first mortgage will come first, followed by any other mortgages or liens filed prior to yours. Oftentimes there is no value left for the lien-holders at the end of the line.


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## TimNJ (Sep 7, 2005)

I would file the papers for small claims. It will be fairly quick and standing before the judge or the threat of having to stand before the judge can really make an impact on somebody.
As Jay said though, the judge can rule for you but then you have to go through the steps to actually collect, up to even having a sheriff's officer escort you to the ho's house and let you start picking ho's personal property to satisfy the judgement.
I know a plumber that went that far. He showed up at ho's house with the sheriff and basically starting going...ho's $5000 car "that's $800", new riding lawnmower, "that's $100", the ho flipped and immediately ran to the bank and came back with all the cash:thumbsup:

It took about 6months from court date to get to that point though.


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## SSC (Feb 8, 2011)

TimNJ said:


> I know a plumber that went that far. He showed up at ho's house with the sheriff and basically starting going...ho's $5000 car "that's $800", new riding lawnmower, "that's $100", the ho flipped and immediately ran to the bank and came back with all the cash:thumbsup:


I would pay to see the look on Their face:laughing::laughing:


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## Leo G (May 12, 2005)

BrandConst said:


> Lien and get a judgement.


Yep, both.


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## TimNJ (Sep 7, 2005)

SSC said:


> I would pay to see the look on Their face:laughing::laughing:



He should right a step by step "Lien's and Small Claims Court For Dummies" book. 
He never lost a case, meaning he always got his money in the end.


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## Satman40 (Mar 14, 2011)

If you win a case does not mean you get paid... 

File in Small Claims, get an Attorney, expect a counter suit..

Win and the Attorney will go for the pro sup....and follow up...


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## Station1 (Apr 20, 2010)

I've been this route before. Here's what I did (in Texas).

I filed a lawsuit in small claims court and won by summary judgement. Then, I filed an "Abstract of Judgment" at the county courthouse. What this does is the next time the defendant needs to record a transaction at the courthouse, the Abstract will screw things up. I waited about 2 months and then got a call from an attorney, they wanted to pay right away. :thumbup:

Another trick you can do is if you know where they have a bank account, you can go to their bank and show them the judgement and request that they draw funds from their account. I have a friend that's a bank president and he told me that they would have to go through their legal dept, but probably would honor the judgement and draw upon their account. But, I've never had to try this.


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## barry1219 (Oct 8, 2011)

Protect yourself and file the lien. Then proceed to send registered mail to notify owner. Do not delay and confuse the order of things. You need to protect your claim and the only way to do that immediately is file the lien. After that if homeowner pays in full then release the lien. No big deal. 
Down here for any contracted jobs over $2500 a Notice of Commencement is required. It is not a hassle and protects all parties invloved. Allows you to file a lien easily if issue like this arise and also holds you to your contract with homeowner.
Quick story. Finished a project $2300 due. Guy cuts me check for amount on Friday. I deposit Friday and the following Wednesday I get a call from the bank the money was removed from my account because he canceled the check!!..I said you can't do that. They did. I activated my lien on the property and waited....and waited...and waited...about 7 months later I got a call from a mortgage company...guess who was trying to refinance?...lol...they asked me to send them a settlement agreement amount..So I did...and a copy of the contract and pictures of the material installed that he did not pay for...he owed me $2270 exactly. I told the mortgage company I would settle for $2473. I explained it was interest and the cost of filing the lien. They said they would call me back after they looked at the fax. I got a call back and was told the HO wanted to call me to clear this up or he would not get refinanced. I told them he has my number. He called me and asked me to help him...so I said..no problem...bring CASH to my house and I will release lien and send mortgage company a release of a paid in full lien. He said he could only do it if he got the mortgage first....I said that is not going to happen...6 months later he was foreclosed and the bank who owned it had to settle with me and offered $.50 on dollar. I agreed.


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## GregS (Oct 1, 2006)

barry1219 said:


> r he was foreclosed and the bank who owned it had to settle with me and offered $.50 on dollar. I agreed.


Clarify that for me, you accepted 50% of What was owing, or the paid you 50% more?


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## barry1219 (Oct 8, 2011)

I accepted $.50 on the dollar from the bank ($1135). The guy was long gone and it was a matter of principle with im. The bank could have filed extra paperwork and had another hearing to disallow my lien. It would have added another 45 days or so to them foreclosing and unloading it. I took the offer and received a cashiers check in about 2 days...
The bank held the position that I was a second lienholder and explained to me it was in their best interest to ask for a 50% settlement and move on.


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## ssroofpros (Jan 22, 2011)

After further educating myself, along with taking in the advice y'all were kind enough to share...I'd decided to move forward with suite. After going over the scenario with her counties Magistrate court clerk, they advised me to hire a collector on a contingency basis. The collector referred by their office attempts to collect the debt in a 3 step fashion.

Step 1. Many phone calls for the first 14-25 days.

Step 2. Hand the collection over to a law firm in the homeowners jurisdiction (back yard as they say) where they would begin to write multiple letters along with many more phone calls.

Step 3. If it goes uncollected and step 3 is necessary, the local law firm will the predetermine whether or not the debt is worth filing suite over. If so and I agree to proceed, it will cost me an upfront $500-$600 for filing fees, and the attorney will then take action by following through with the necessary filing procedures.
If we obtain judgement (win) they will also continue to proceed with collection of judgement, however necessary to the fullest extent the law allows. 
If the collection attempt isn't successful I pay nothing as it's contingent upon successful collection, but dint know about the filing fees...I'm awaiting that answer. The contingent commission is 30% of the debt collected, if collected.? Seems a bit high to me, but this is the first and only agency I've spoken with regarding?

Soo...any thoughts and (or) experience going this route? Thanks again folks! I appreciate all the time and advice!


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## BamBamm5144 (Jul 12, 2008)

That is a good idea and what I have started doing. I haven't had anything go close to that far yet but I find it much more effective than if I were to call.


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## ssroofpros (Jan 22, 2011)

BamBamm5144 said:


> That is a good idea and what I have started doing. I haven't had anything go close to that far yet but I find it much more effective than if I were to call.


Well that's good to hear. How do u feel about the commission being a whooping 30%? The collection co I'm looking at is rpsworldwide.net if that helps when advising me what to do next.?
If i'm understand your post correctly, it seems as if the delinquent client(s), prior to having to file suite and rather than paying the collector they're paying you.? 
If the collection process does scare the homeowner back to dealing with me, I'm pretty sure there is a "fine print" commission that I'll have to pay...not sure if it's 30%, but I think I remember reading something about me having to report any and all payments (partial & in full) to the agency upon receipt. There are allot of if ands or buts in the agreement and the number 10% not only sounds familiar, but I'm certain it's a fee for many variables in their "fine print".? 
My other collection choice out here is by attorney directly for a similar contingent fee if successful. There is a well know attorney around here that does ONLY debt recovery/collections? The website is reddlaw.com. Maybe the page can help with any advise regarding my next step?

From my experience, on the other side of this collection idea (sent to collections personally lol), it has yet to be successful for certain medical bills I have from back in 2007-8.? That's one of a few things holding me back from proceeding with this...that and the 30% commission. I'm not sure if that's the average cost for this, or if it's a bit higher than most other agencies? Problem is there's a bigillion agencies and I'm sure only a small percentage of them are worth a crap.?


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## Source (Feb 21, 2011)

30% is actually fairly reasonable, i have dealt with collectors that asked for 40 and even 50% of the debt if collected, it was for difficult accounts thought... on another note, here in CA there is a place called "We the people" that will file a mechanical lien for you for $45.. 

Very reasonable and efficient.


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## cleveman (Dec 28, 2007)

Why can't you guys put your location in your profiles?

ssroofpros: You are getting screwed by an attorney.

If you can read and write at the junior high level, and you obviously can, than you should be able to access the courts.

To hell with phone calls and harassing the guy, you need a judgement against him. So you file in small claims court and get the judgement. You tell me what the filing fee is. Prolly around $75, plus service.

Then you need to collect. Another $25 fee, plus service from the sheriff's dept. This is when you go after their bank account, garnish wages, what not. I would be interested in what is allowed. I have heard that a law officer can go to them and ask them to empty their pockets. If the story about confiscating their personal property is true, I would love to see it in action. I also think that if you can't collect anything from them, this is when you put a claim against their property, such as cars, home, etc. Then when they go to re-finance their home or sell their car, it is blocked by you.

Stop letting the attorney/scheisster collection agency bleed you and get the job done and keep us informed how it is going.


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## smalpierre (Jan 19, 2011)

:laughing:

I'm lucky, haven't had to go through all that. Thought a contractor was going to burn me once, and had to look into how to file a lien and get a judgement and all - but the guy ended up paying up - after not calling me for a few weeks.


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