Mechanic's lien
A lien recorded by a contractor, subcontractor or supplier who improved a property and was not paid, enforceable by a foreclosure suit.
Definition
A mechanic's lien is a claim against a property recorded by a contractor, subcontractor, laborer or supplier who improved the property and was not paid. It is recorded in the county records and can be enforced by a lawsuit that ends in a forced sale.
The rules are strict and set by state statute. In California, a claimant generally must record the lien within 90 days after the work is completed and then file a foreclosure lawsuit within 90 days after recording, according to the Contractors State License Board. Most subcontractors and suppliers there must also send a preliminary notice to keep their lien rights. A homeowner can face a lien even after paying the general contractor in full, if the contractor did not pay a sub. For a buyer, an open mechanic's lien must be paid, bonded or released before closing, and it often points to a renovation that stalled or a dispute that left the house half finished.
Source: cslb.ca.gov
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