Frequently Asked Questions

A mechanic's lien is a legal claim filed by contractors, subcontractors, suppliers, or laborers against a property they worked on or provided materials for, as a way to secure payment for their services. This lien ensures that those who contribute to the improvement of a property are compensated, by placing a hold on the property's title until the debt is settled. If the debt remains unpaid, the lienholder may have the right to force the sale of the property to satisfy the lien.

A Mechanic's Lien is a legal claim against a property for unpaid work or materials used in construction or improvement of the property. Filing a Mechanics Lien (or construction lien claim) is a way for a contractor, subcontractor, or supplier to secure payment for services and materials provided to a construction project. If the owner of the property or the general contractor fails to pay, the lien provides a means to recover the amount owed through a court action or the sale of the property. Filing a mechanic’s lien can also serve as a warning to potential buyers of the property that there is a claim against it. Mechanic's Liens provide protection to contractors, vendors, material suppliers and professional services in the construction industry. A Lien is a legal tool to protect yourself, for non-payment.

A bond discharges a lien by effectively transferring the lien from the property to the bond itself. Here’s how it works:

1. Filing the Bond: The property owner, contractor, or another interested party files a surety bond with the court or relevant authority. This bond must typically be in an amount greater than the lien, often 110% or more of the lien amount, to cover potential legal fees or interest.

2. Lien Removal: Once the bond is filed and approved, the lien is removed from the property’s title. This clears the title, allowing the property to be sold, refinanced, or continue to be developed without the encumbrance of the lien.

3. Claim Against the Bond: The lienholder no longer has a claim against the property but can now make a claim against the bond for the amount owed. If the court rules in favor of the lienholder, the surety company that issued the bond will pay the claim up to the bond's amount.

In essence, the bond serves as a financial assurance that the lienholder will be paid, while freeing the property from the lien’s restrictions.

New York Lien Law § 19(4), allows a lien to be discharged by filing a surety Bond. A Bond Discharge is a mechanism for temporarily removing a mechanic's lien from the title of the property. The property owner or contractor can file a Bond against the Mechanic's Lien. A Bond deposits 110% the value of the Lien with the courts. 

The bond guarantees the Lienor any payment that is still due to them with interest should they win the case in a court of law.

A construction surety bond to discharge a mechanic's lien can typically be filed by the property owner, a general contractor, or a party with an interest in the property, such as a lender or developer. This bond acts as a financial guarantee that the lienholder will be paid if they are successful in their claim, while removing the lien from the property itself, allowing construction to continue or the property to be sold or refinanced.

If a Mechanic's Lien was filed against you; one option you have is to file a Bond Discharge against the Mechanic's Lien. The Bond temporarily removes a Mechanic's Lien from the title of the property. This gives the owner the ability to continuing financing the project. 

Once a Surety Bond is obtained, New York Bond Filing Agent handles the filing of the Bond with the proper jurisdiction and service upon the parties. 

Upon filing of the Bond, the Lien is removed from the property and now "attached" to the Discharge Bond. A Discharge of a Lien by bond or deposit is not an admission of guilt or fault

A Lien Discharge Bond is the most common and effective way of discharging a Lien. If a Lien was filed against you, you have the right to file a Bond Discharge a/k/a "Bonding Off" to temporarily remove the Lien Claim. 

Filing a lien Discharge bond is the most simple and cost effective method of discharging a lien. 

There are many benefits to filing a Surety Bond against a Mechanic’s Lien, including:

1. 1. Release of the lien: By filing a surety bond, a property owner can often obtain a release of the mechanic’s lien that has been filed against their property. This can prevent the lienholder from foreclosing on the property or otherwise taking legal action to collect the debt.

   2. Preservation of the property: Filing a surety bond can help preserve the property owner’s ownership rights and prevent the property from being sold to satisfy the debt. This can be particularly important for commercial or residential properties that are important assets for the property owner.

   3. Protection of credit score: If a mechanic’s lien is filed against a property owner, it can negatively impact their credit score and ability to obtain financing in the future. Filing a surety bond can help protect the property owner’s credit score and financial reputation by ensuring that the debt is satisfied.

   4. Cost-effective alternative: Filing a surety bond can be a cost-effective alternative to paying the debt in full or engaging in lengthy legal proceedings. The property owner can often obtain the release of the lien by paying a percentage of the total amount owed, which is typically less than the full amount of the debt.

   Overall, filing a surety bond against a mechanic’s lien can be a useful tool for contractors or property owners who are facing financial challenges or legal disputes related to their property. It is important to work with an experienced surety bond agency to ensure that the process is completed correctly and in accordance with local laws and regulations.

Bonding of a mechanic's lien has two steps. The first step is obtaining a surety bond. The bond amount is typically equal to 110% of the value of the total amount of the lien. The cost of the Bond is usually a fee of 2-5% of the total value of the Bond, depending on the “risk.” If you need a referral to a surety company, we can assist. 

The second step is filing of the actual bond. Once the bond is issued, New York Bond Filing agent handles filing the Bond with the courts. Upon filing the Bond, the Lien is immediately discharged of record. 

New York Bond Filing Agent has the expertise and experience to navigate the legal requirements and procedures involved in filing a surety bond. We can ensure that all the necessary paperwork is filed correctly and on time, minimizing the risk of errors. 

Filing a bond discharge can be stressful and time-consuming, especially if you are already dealing with the fallout of a mechanic's lien. Hiring a professional company to handle the filing process can give you peace of mind and free up your time to focus on other aspects of your business.

Hiring New York Bond Filing Agent is more cost-effective option than retaining an attorney.

If the underlining mechanic's lien is extended, you can extend your bond. This would be handled directly with the surety company. 

If a Lien was Bonded, the Lienor still has the right to file a Foreclosure Action in the same manner as a Lien that has not been Bonded. 

An owner, who would be a necessary party in a lien foreclosure action, is not a necessary party once the lien has been bonded. Instead, the lienor may name the surety as a defendant, ensuring there is a solvent party to pay the judgment if the lien claim is proved.

Click here to File a Bond Discharge of Mechanic's Lien Now.

Once the mechanic's lien is Bonded off, the property title is free and clear of the mechanic's lien.

A Discharge of a Lien by bond or deposit is not an admission of guilt or fault and the lienor is not automatically entitled to payment. Additionally, the Lien must be enforced via enforcement for the lienor to recover from the fund.