Friday, May 15, 2009

Recent Illinois Law Saves Homeowner From Failure To Obtain Lien Waiver & Paying Twice For Home Improvements When Fully Paid Contractor Stiffs Subs

In Chicago, Illinois, NBC Chicago reports:
  • There's a piece of paper that can stand between a homeowner and a construction calamity, between being done with a job and having it come back to drain you of more money. The waiver of lien is easy to get, yet many consumers don't hear about it until it's too late. Such was the case with the Harney family. A year after their kitchen renovation was done and paid for, they received a notice of lien on their home. It demanded payment of $3,900 within 10 days or the home would be foreclosed upon.(1)

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  • But a "waiver of lien" can protect the homeowner from all the headache. A contractor who provides it "releases" and "waives" rights to placing a lien on the property, guaranteeing that "all suppliers" connected to the job "have been paid." It's a crucial document that many even in the industry don't comprehend. And while the Harneys are worried of what might happen, their lawyer is not.

  • "They can't do this," said attorney Dan Edelman, pointing to a relatively new state law that says that if consumers have paid once, and can prove it, they cannot be made to pay again. "It's to protect homeowners against exactly this type of problem. If the homeowner deals with the contractor in good faith and pays them, that ends their obligation," Edelman said.

For more, see Lien Times (Waiver of lien protects homeowners who have paid in good faith).

For more on homeowners left in the lurch due to actions by builders/contractors, go here, go here, go here, go here, and go here.

(1) Reportedly, at the root of the problem was a dispute between the Harney's general contractor and the company that supplied the cabinetry. The companies reportedly sued and countersued each other, leaving the Harney's stuck in the middle. When the cabinet company didn't receive payment, it came after the Harney's home and slapped a lien against it. The problem in many cases is that the homeowners have paid the general contractor, who they assume will pay everyone else. StiffingContractorsTheta