Homeowner Protections Against Mechanics Liens in California

Why Homeowners Need to Understand Mechanics Liens

Most homeowners are blindsided by mechanics liens. You hire a general contractor, pay them on time, and assume everyone downstream is getting paid. Then a subcontractor you've never met records a lien against your property because the GC pocketed the money instead of paying them.

This is not a rare scenario. It happens on residential projects across California every day. The subcontractor has a legal right to lien your property because their labor or materials improved it — regardless of whether you had a contract with them.

The good news is that California law provides homeowners with several protections. The key is understanding them before you start a project, not after a lien has already been filed.

How Liens End Up on Your Property

The mechanics lien system creates what is sometimes called the "owner pays twice" problem. Here's how it works:

• You hire a general contractor and pay them for the work
• The GC hires subcontractors (plumbers, electricians, framers) and material suppliers
• The GC fails to pay one or more of those subs or suppliers
• The unpaid sub or supplier records a mechanics lien against your property

You've already paid your GC in full. Now you face a lien from someone you never hired. If you don't resolve it, the claimant can file a foreclosure lawsuit against your home. This is the core problem that California's homeowner protections are designed to prevent.

Your Right to Receive Preliminary Notices

California Civil Code §8200

Preliminary notices are your early warning system. Under California law, anyone who is not in direct contract with you (subcontractors, material suppliers) must serve a preliminary notice within 20 days of first furnishing labor or materials to your project. This notice tells you exactly who is working on your property and preserving their lien rights.

What to do when you receive one

• Don't panic. A preliminary notice is not a lien. It does not mean anyone is threatening you or that there is a payment problem.
• Keep it on file. Create a folder for every preliminary notice you receive on the project.
• Verify with your GC. Ask your general contractor to confirm they are paying this party. Request proof of payment.
• Use it as leverage. Before making your next progress payment to the GC, require lien waivers from every party who sent you a preliminary notice.

If someone who furnished labor or materials does not serve a preliminary notice, their ability to file a mechanics lien is significantly limited. For a deeper understanding, see our California preliminary notice guide.

Require Lien Waivers Before Paying

California Civil Code §8132–§8138

Lien waivers are the single most effective tool homeowners have to prevent mechanics liens. Before you release any progress payment to your general contractor, require conditional lien waivers from every subcontractor and supplier who sent you a preliminary notice.

How to use waivers effectively

• Progress payments: Require conditional waivers on progress payment (CC §8132) from the GC and all subs before releasing each draw
• Final payment: Require unconditional waivers on final payment (CC §8138) from all parties before making the last payment
• Match to preliminary notices: Cross-reference waivers against your preliminary notice file. Every party who notified you should provide a waiver.

A conditional waiver only takes effect once the payment clears, so it protects both you and the subcontractor. If the GC resists providing waivers from their subs, that is a major red flag. Learn more in our California lien waiver guide.

Joint Check Agreements

A joint check agreement is a simple but powerful arrangement: instead of paying the general contractor alone, you write a check made out to both the GC and the subcontractor jointly. Both parties must endorse the check to cash it, which ensures the subcontractor actually receives the money.

When to use joint checks

• When you have concerns about whether your GC is paying their subs
• When a subcontractor contacts you directly about non-payment
• On large subcontract amounts where the risk is significant
• When your GC agrees to the arrangement (it's voluntary, not required by law)

Limitations

Joint checks are not a complete solution. They only cover the payments you direct through them, and they require the GC's cooperation. They also don't protect against material suppliers or second-tier subcontractors. But for major subcontract items like plumbing, electrical, or HVAC, they can provide meaningful protection.

What to Do If a Lien Is Filed Against Your Property

If you discover a mechanics lien has been recorded against your property, don't panic. You have options. But you need to act deliberately and understand the timelines.

Step 1: Verify the lien is valid

• Did the claimant serve a preliminary notice? If not, their lien rights may be limited or invalid.
• Was the lien recorded within 90 days of project completion or cessation of work?
• Does the lien claim an amount consistent with the work actually performed?
• Did the claimant actually furnish labor or materials that improved your property?

Step 2: Evaluate your options

For a comprehensive overview of the mechanics lien process, see our California mechanics lien guide.

The Notice of Completion

California Civil Code §8182

Filing a notice of completion with the county recorder is one of the simplest and most effective things a homeowner can do to limit lien exposure. When you record a notice of completion, it shortens the deadline for filing mechanics liens:

• General contractors must file their lien within 30 days (instead of 90)
• Subcontractors and suppliers must file their lien within 60 days (instead of 90)

When to file

You must record the notice of completion within 15 days after completion of the work of improvement. If you miss this window, the notice is ineffective.

Why it matters

By accelerating the lien filing deadline, you create a shorter window of uncertainty. You'll know sooner whether any liens are going to be filed, and you can close out the project's financial exposure faster. This is especially valuable on large residential projects where multiple subcontractors are involved.

Owner-Builder Special Risks

If you are acting as your own general contractor (an "owner-builder"), your exposure to mechanics liens is significantly greater. Here's why:

• Every sub and supplier has a direct relationship with you. There is no GC sitting between you and the people doing the work. Each one has direct lien rights against your property.
• You must manage all payments yourself. There is no GC to coordinate payments to subs. If you miss paying a supplier, they can lien immediately.
• Preliminary notice requirements may differ. Parties in direct contract with the property owner are generally not required to serve a preliminary notice to preserve their lien rights. This means you may get no warning before a lien is filed.
• More parties, more risk. Instead of managing one relationship with a GC, you're managing relationships with every trade on the job.

How Prelien Helps Homeowners

Prelien gives homeowners the same tools that large commercial property owners use to manage construction payment risk on every project:

• Track who's working on your project — Maintain a clear record of every subcontractor and supplier involved, organized by project
• Collect and manage lien waivers — Request, track, and store conditional and unconditional waivers from all parties before releasing payments
• Verify preliminary notices — Keep all preliminary notices organized and cross-referenced with your payment records
• Monitor deadlines — Know exactly when lien filing windows open and close for every party on your project

Prevention is always less expensive than dealing with a lien after it's been filed. Prelien helps you stay ahead of the problem.

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