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Key facts about construction liens

Florida uses a construction lien law that is defined in the Florida statutes, in sections 713.001-713.37. As you'll see, it's crucial to know how this works so that you do not run into any serious issues.

The first thing you should know is that a lien against your property can be used if people who have provided services and/or materials don't get paid. Your property is then used as collateral.

For example, if you have a contractor build you a home and then you don't pay him for the work, he can claim that he has a right to own your home -- or, at least, to have your home forcibly sold to collect the money that is owed. This is done to protect contractors who have invested money in parts and materials, not to mention the time and work they've invested spending months building the home.

One important thing to note is that subcontractors and sub-subcontractors can also make claims. This is true even if you pay the contractor the total of what is owed, if the contractor then doesn't pay the subcontractor. This means you may think that the debt is taken care of and then still have a claim made against you.

For example, you may hire a contractor who does all of the construction work himself, but he may then hire a plumbing company to run the water lines. The cost could be factored into the overall bill that you get, with the idea being that the contractor then has to pay the plumber.

It is possible to protect yourself from a construction lien with various clauses that can be put into the construction contract. If you're concerned, it may be wise to look into these.

Source: Online Sunshine, "The 2016 Florida Statutes," accessed June 29, 2016

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