How to File an Oregon Mechanics Lien – Step By Step Guide To Get You Paid

Getting paid for work done on construction projects can be more difficult than it should be. One powerful way to protect against nonpayment is by filing a mechanics lien. Mechanics liens are powerful tools that can help ensure construction participants get paid for the work they’ve done. If you’re unpaid for work or materials provided to a construction job in Oregon, filing a mechanics lien may be the help you need to get paid. While Oregon lien rights are powerful and expansive, certain steps must be taken in order to retain the ability to file a lien and to make sure the lien is valid.

To successfully record a valid and enforceable mechanic’s lien, you must comply with preliminary notice requirements, prepare documents to strict formatting and content specifications, meet certain deadlines, and get the lien recorded with the proper office. Opportunities to make mistakes abound, and any potential mistake (no matter how small) can cause problems or even completely invalidate a lien claim, which leaves you without the security a lien provides.

This how-to guide provides a start-to-finish explanation on how to file an Oregon mechanics lien. Keeping reading to get all the details right, to get your claim filed, and to get your money fast!

Step 1: Sending Preliminary Notice Is Generally Required in Oregon

The true first step in filing an enforceable Oregon mechanics lien is making sure that any preliminary notice requirement has been met. While parties who contract with the property owner only need to provide a preliminary Information Notice to Owner on residential projects that exceed $2,000, all other project participants must send a Notice of Right to Lien on all residential projects. And, it’s best practice to send the preliminary notice on all projects.

When the Notice of Lien rights is required, sub-tier participants must give the property owner the notice within 8 days of beginning work. This time period is very very short, so project participants in Oregon need to stay alert. While the failure to give the notice within the proper time period is not fatal to a lien claim in Oregon, doing so will be detrimental to a subsequent lien claim. In Oregon, a late notice relates back 8 days from when the notice was given, and only protects the labor or material furnished starting from that date. And, failure to give the notice at all is fatal to the ability to file a valid lien.

Once the preliminary notice requirement has been met, you can move forward with filing your lien. And that means preparing your mechanics lien form. This may seem like a simple fill-in-the-blank task, but you need to be careful: mechanic’s lien laws are very complex. Even if you have a proper mechanics lien form there are many traps for the inexperienced.

This section will help you get the mechanics lien form you need, get it filled out, and get it ready for filing.

Everything You Need to Know About Oregon’s Mechanics Lien and Notice Rules:  Oregon Lien & Notice FAQs

Step 2: Getting the Mechanics Lien Form You Need

At the end of the day, there is nothing inherently special about a mechanics lien form or template. A mechanics lien is just a regular piece of paper that has certain words on it, and that has been recorded in a government office. As long as a mechanics lien contains the right information, and is in the proper format, it is sufficient to do its job. However,  it’s critical for you to get the right mechanics lien form, so that you can be assured that the information on it, and the formatting of the document, is actually correct.  Otherwise, your lien claim could easily be invalid – even if you comply with all of the other requirements. There are many places to find mechanics lien forms, but not every form is correct. Be careful to get your form from a reputable source.

Step 3: Filling Out Your Oregon Mechanics Lien Form

It is important to make sure that your Oregon mechanics lien contains all of the necessary information required by statute. Oregon statute § 87.035 sets out the specifically required content of the lien claim document, but there are also additional rules, regulations, and deadlines that must be met.

Failing to provide the required information on the lien claim (and providing it in the correct format) isn’t just a simple mistake – it can invalidate the entire lien. Clearly, it’s critically important to make sure the proper information is obtained and included in the lien document. The following information is specifically required for Oregon mechanics liens.

1. A True Statement of the Demand (After Deducting All Just Credits and Offsets) 

One of the most important, and obvious, parts of a mechanics lien is the amount of the lien itself. The property owner, and every other interested party must know the amount due. However, just because you are owed money doesn’t mean that it can be properly included in a lien claim. While each situation has its own little nuances, the general rule is the same for all lien claimants on Oregon projects: you have the right to file an Oregon mechanics lien for the amount equal to the value of the work you performed or material furnished to the project, minus any amount already paid (or otherwise offset). Other amounts – attorney fees, interest, or other amounts may be “due” but don’t put them in your lien amount, it may put your entire claim at risk.

Because of this, an Oregon mechanics lien should include a “true statement” of the demand. This means that you must provide an accurate account of the amount of unpaid labor after deducting any credits and offsets. “Credits and offsets,” however, include only amounts between subcontractor and general or prime contractor and do not include amounts between lienor and third party. 

2. The Name of the Owner or Reputed Owner of the Property (if Known)

An Oregon mechanics lien must also identify the property owner of the property whose interest in the property will be affected by the lien claim. This information is important for many reasons, the owner’s property is encumbered by a lien claim – so they need to know – and the county may use the owner’s name for indexing purposes. Getting the property owner identified on your lien, and getting the owner right, is a key part of filing your lien.

It is a curious part of Oregon’s mechanics lien law that the lien purports to only require the identity of the property owner (or reputed property owner) if known. This stands in contrast to the “requirement” later in Oregon statute that the claimant provides notice of the filed lien to the owner and the mortgagee. If the claimant doesn’t know who the property owner or mortgagee is, this becomes difficult.

Luckily, however, there are many ways to find the owner of the property: tax assessor maps, GIS searches, third-party databases, and more. A claimant can even exist the assistance of third-parties to search out information for them.

3. The Name of the Party Who Hired the Claimant

Oregon lien law specifically provides that “[t]he name of the person by whom the claimant was employed or to whom the claimant furnished the materials or rented the equipment or by whom contributions are owed” must be present on the face of a valid lien document. This should be easy to comply with, so don’t mess it up!

Every party should know with whom they contracted or otherwise agreed to perform work or furnish materials. The statute doesn’t specify that a full legal name of the hiring party is necessary, so it seems that a “doing business as” name, or the name known to the lien claimant should be sufficient here.

4. Description of the Property 

Oregon’s mechanics lien laws require a “description of the property to be charged with the lien sufficient for identification, including the address if known.”

This is helpful to lien claimants because Oregon law specifically does not require that a lien claim must contain legal descrip­tion of prop­erty covered by lien. In fact, Oregon is relatively relaxed in the identification of property on a mechanics lien. Cases have held (and annotations to the Oregon statutes have memorialized) that even when the descrip­tion of prop­erty in lien notice incorrectly stated the address and tax lot number and referred to business es­tab­lish­ment on prop­erty by incorrect name, but contained sufficient in­for­ma­­tion to enable interested parties to identify prop­erty and no prejudice was shown, there was substantial compliance with the property description requirement, and was sufficient for a valid lien.

Despite this, however, the best practice is to provide an accurate description of the property to be charged with the lien. Even including a legal property description, if known.

5. Sign Your Oregon Lien & Have It Notarized

Finally, in order to complete your Oregon mechanics lien, you must sign your mechanics lien claim, and have it notarized.

An Oregon mechanics lien must be “verified by the oath of the person filing or of some other person having knowledge of the facts.” It is important to make sure that the information on the lien claim is correct because the party swearing to the information contained on the lien claim is “subject to the criminal penalties for false swearing provided under ORS 162.075.”

That’s it!  

Once you get through these steps, you’ll have a completed mechanics lien form ready to go.  But you’re not done yet.  Your next step is filing the lien in the proper recording office.

Get free mechanics lien form

We're the mechanics lien experts. We offer forms made by attorneys and trusted by thousands.

Step 4: File Your Lien in the Appropriate Recording Office

Now that your lien document has been sufficiently filled out, it’s finally time to file your mechanics lien. While this may seem like the easy part, it’s important to remain careful.  A lot can go wrong with lien filings, such as:

• You might get the filing fees wrong;
• You can file it in the wrong government/county office;
• You can not understand the county’s turnaround time and file late;
• You can get you lien rejected and miss your lien window;
• You can show up without the right paperwork and delay the process;

It is absolutely critical to make sure your Oregon mechanics lien is filed on time!  Oregon has strict deadlines for when liens must be filed, and those deadlines may not be extended. If someone is promising you payment, that’s great, but it won’t change your lien deadline.

The time you have to file an Oregon mechanics lien is the same no matter what the project type or the claimant’s particular role: the earlier of 75 days after the claimant’s last furnishing of labor and/or materials or 75 days after the completion of the project. 

1. Which Oregon County Office Records Mechanic Liens?

Generally speaking, you need to file your Oregon mechanics lien with the recording officer of the county in which the improvement, or some part thereof, is situated. In rare cases in which the property improved extends into more than one county, a lien must be recorded in each county where the real property to which the improvement was made is located if the claimant wants the lien to encumber the entire property.

This can be confusing, so we’ve compiled a list of all the Oregon county recording offices that file mechanics lien claims, and provide you with some information about how to file in the county here:

2. What You Need To Bring Or Deliver to the Oregon Recorder’s Office?

Now that you know in which office your Oregon mechanics lien must be recorded what should you bring with you?

1. The completed lien claim;
2. A blank check for recording fees

3. Should You File Your Lien Electronically, In-Person, or by Mail?

Some counties in Oregon accept mechanics lien documents for electronic recording, but some do not. In nearly all cases in which a lien may be electronically recorded, it is the fastest and most efficient way to get a mechanics lien recorded. E-recording provides step by step instructions for uploading and sending the lien document, as well as neatly setting forth the recording fees, so there is no worry about calculating the fees and getting a lien rejected for miscalculation.

However, if the county doesn’t accept e-recording, or you have for some reason chosen not to use e-recording, the lien must be delivered to the proper recorder’s office by other means. The lien claim may then be delivered by mail or FedEx or may be walked into the office, either by you or by a courier.

Remember, the proper recording fees must be included with the lien. Liens are often rejected for improper fees (even if the miscalculation resulted in providing too much money). Accordingly, it can be a good idea to bring multiple blank checks with you to the recording office or use a “do not exceed” check if mailing the lien claim to the county. While you can calculate your filing fees beforehand, it seems that something always comes up that throws a wrench in the works. Generally, the filing fees can be best determined by calling the county recorder, or asking in person if you walk in your lien claim document. Any delay caused by needing to resubmit the lien for recording takes time – and since liens are time-sensitive documents, it can possibly result in a missed deadline.

As noted above, mechanics liens have a strict deadline by which they must be filed. Since filing a lien is a last resort, this usually results in a fairly tight timeline. With the consequences for a late filing being that the lien claim is rendered invalid and unenforceable, it’s important to consider filing delays into your lien filing workflow. Remember, if your lien is sitting in the county’s mail bin, it is not considered filed.  Also note that if you are sending your lien in by mail, you’ll need to get the filing fee exactly right, and provide a self- addressed stamped envelope with return instructions if you wish to receive a copy of the recorded lien for your records.

Once you have a stamped copy of the recorded lien in your possession, either by getting near-immediate confirmation from electronic recording, a copy handed back to you if you delivered it in person, or received a stamped copy back in the mail if you mailed the lien to the county, you have an official recorded mechanics lien.  Congratulations!

However, while filing the lien is a big step – your work is not yet done. In order for the process to be officially complete, you also need to serve a copy of the lien claim on the property owner and the mortgagee.

Step 5: Serve a Copy of Your Lien 

Oregon requires that a mechanics lien must be both filed and served on certain parties. ORS 87.0359 states that: “[a] person filing a claim of lien pursuant to ORS 87.035 (Perfecting lien) shall mail to the owner and to the mortgagee a notice in writing that the claim has been filed.” A copy of the lien must be attached to this notice, and this notice must be provided no later than 20 days after the date on which the lien claim as filed.

While it is set forth in Oregon statutes as a mandatory step “shall mail to the owner . . . ” the second section of the above-cited statute appears to set the penalties for failure to serve a copy of the lien claim as merely a prohibition on recovering “costs, disbursements or attorney fees otherwise allowable” under the foreclosure rules. However, don’t push your luck. Get a copy of the mechanics lien served on the owner and mortgagee within the 20-day time period and rest easy.

Congratulations! Once the lien document has been filed and served – your Oregon mechanics lien is ready to get you paid what you’ve earned. While liens are very powerful – they are still able to be disputed or challenged. filing the lien may not be the end of the road. Even if the lien is not challenged, you may be required to enforce your lien claim through a foreclosure action in order to get paid – which can be a time-intensive process.

What You Need To Know & Do After You File Your Oregon Mechanics Lien

After your mechanic’s lien is on the books, you may be wondering, what to do next?

An Oregon mechanics lien only stays effective for 120 days from the date the lien was filed. If this 120-day period passes without an action to enforce the lien being initiated, or the lien being extended through an agreement between the claimant and property owner, the lien will expire and become unenforceable. Oregon does allow a mechanics lien to be extended, but the process requires the owner to agree to an extended payment plan, so it is rarely applicable. However, the option to extend does technically exist, so one of the following three actions must be undertaken prior to the expiration of the 120-day period after the lien is recorded.

1. Extend Your Lien

Oregon allows a mechanics lien to be extended in 120 day increments up to two years from the date of the lien’s filing. This is a very unique enforcement deadline. However, in order to extend the deadline, an extended payment plan must be arranged between the parties with the terms of the plan stated in the lien itself. Accordingly, this is very very unusual and rarely applicable.

2. Foreclose on the Lien / Enforce Your Lien

If you have not been paid and the enforcement deadline is approaching, you’ll likely want to bring an action to enforce the lien. Doing so enables you to foreclose upon the property to recover the money you’re owed. This will keep the lien viable during the lawsuit, and at the end of the suit, if you win your case, the lien will turn permanent, and you’ll be allowed to foreclose on the property to sell it and pay off your debt.

Enforcing a lien requires filing a lawsuit. You can hire a construction attorney to do this for you.

Before you initiate the lawsuit, there’s one more hoop to jump through. Oregon is unique in that, once a lien is filed and served, there’s yet another step before an Oregon mechanics lien can be enforced. Oregon actually requires that a Notice of Intent to Foreclose be sent prior to enforcing a mechanics lien. This provides one more opportunity to resolve a dispute before taking to the courts. In Oregon, a Notice of Intent to Foreclose must be delivered to the property owner and mortgagee at least 10 days prior to whenever the mechanics lien will be foreclosed.

3. Release (or cancel) the lien

If you’ve been paid, or if the lien claim is invalid or insufficient for some other reason, you will probably need to file a lien release. The process of filing a lien release is similar to that of filing a lien – it is a document that has required information and is recorded in the same office as the lien itself. The filed release provides notice to third parties that the lien no longer encumbers the property at issue.

Oregon Mechanics Lien Resources

This is a guide on how to file an Oregon mechanics lien, but you may have some other questions about your mechanics lien rights, deadlines, and more.  Here are some other helpful resources to get you paid on an Oregon construction job:

• Oregon Mechanics Lien FAQs & Resources
• Oregon Preliminary Notice FAQs & Resources
• Oregon Lien Waiver FAQs & Resources
• Oregon Mechanics Lien Form
• Ask A Payment or Legal Expert A Oregon Lien Question
• Blog posts about Oregon construction payment topics

Summary

Article Name

How to File an Oregon Mechanics Lien – Step By Step Guide To Get You Paid

Description

This step-by-step guide takes you through the entire process to file a mechanics lien in the state of Oregon. Includes links to Oregon mechanics lien FAQs and more.

Author

Nate Budde

Publisher Name

Levelset

Publisher Logo