Like other states, Tennessee has laws which give contractors and other firms in the construction industry the right to have a mechanic’s lien on the home or business property where the firm did their work.

When all goes well, the mechanic’s lien is actually a good thing for both the construction firm and the person or business needing the work performed.

It gives the firm the option of foreclosing the lien and selling the property at auction if the firm does work and then does not get paid for it.

This extra security in turn gives the firm confidence to start work without insisting on payment up front.

It is important to navigate Tennessee’s mechanic’s lien law carefully

However, both those who hold a mechanic’s lien and those who may own property subject to it need to make sure that they understand the laws and know what to do in the event of a dispute.

For example, the law imposes a window of time during which a lienholder can enforce the lien. Unless the construction firm brings a lawsuit asking to foreclose the lien, it expires 1 year after the project ends.

Other state and local laws also apply to mechanic’s liens, and this network of laws can be a legal minefield for a construction firm. Not navigating these laws carefully can mean a construction firm loses out on part or all of the value of its contract.

On the other hand, landowners need to address mechanic’s liens promptly and seriously. If they try to ignore the problem or just spend too much time deciding what to do, they may end up losing the very property they spent money fixing up.