Even though you always work hard to deliver the results your customers expect, some customers are never happy. If you have substantially completed work on a project, you deserve to receive payment. An unhappy customer may be slow to pay, however, which eventually affects your bottom line.
While there are some risks that come with doing so, putting a construction lien on the property may be the right course of action. After all, according to HomeLight, it can be difficult for homeowners to sell properties that have construction liens. This gives them an incentive to pay. Still, your construction liens do not last forever.
Construction liens have expiration dates
Like in other places, construction liens in New Jersey have expiration dates. Because you are probably busier than ever staying on top of your construction business, you should talk to your attorney about when your construction lien is likely to expire. You should also ask about your options for proactively dealing with expiring liens.
You can cancel the lien
Even though construction liens expire, they continue to run with the properties they encumber. Still, you may not be able to enforce your lien after its expiration date. If your customers have paid, you also likely need to cancel the lien to collect the funds. Often, contractors choose to cancel construction liens when they expire to avoid the possibility of future litigation, which can be costly.
Even though your construction liens will expire at some point in the future, it is hard to overstate their value for collecting payment. Ultimately, by closely watching the expiration dates on all your liens, you can take appropriate steps to deal with each one.
