In this PCM post we'll talk about how and when to use a multiple properties lien.
What is a Multi-Lien?
A multi-lien is a term we at Lien-Pro® use to refer to one lien that is registered against multiple land titles. This particular term may be known by another name by other entities.
If you have provided work/materials to the same customer on multiple properties/units, you may be eligible to file a multi-lien. Generally, to file a multi-lien, all work/materials must have been provided under the same contract. Multi-liens most commonly occur on new condo developments and multi-unit commercial developments. It is recommended to only lien multiple titles if the titles all have the same owner. For example, with new builds, it will typically be the developer that owns all the units.
When a Multi-Lien Cannot be Used
If the work/materials were provided to different customers, were provided under separate contracts, or if the work was done at staggered times; then separate liens will need to be filed. In other words, each contract or separate supply of work should have a separate lien.
Cost- Savings: Multi-Lien Strategy
As there will be added costs for each additional title that is "liened", you may wish to strategically choose which titles you are including in your multi-lien. For example, if you provided work/materials to a new condo complex that has been divided into 200 titles/units, it may not make sense financially to lien all 200 titles. If you are not liening all 200 units, you may want to attach your lien to the units that have the highest value and the units with the most perceived demand, as this will give you the most leverage with your lien. This concept can also be applied to a multi-unit commercial development.
Conclusion
A multi-lien is one lien that is applied to multiple land titles. When you have provided work/materials to the same customer under the same contract, to multiple properties/units you may be eligible to file a multi-lien. Lien filing can be costly; therefore, you may wish to strategically pick which units you chose to include in your lien.
About PCM Corp
AT PCM Corp, we believe it is important for us to become an integral part of the total credit management process. We strive to be a valued partner for our many business clients, helping them to manage risk and providing them with ongoing professional support.
If you are unsure if your situation qualifies for a multi-lien or if you have any other questions regarding lien filing Contact our office today at 1-866-266-0117 or [email protected].
**Disclaimer: LIEN-PRO by Priority Credit Management ("PCM") is strictly a lien filing agency. We are not lawyers. The information provided by PCM does not constitute legal advice and should not be relied on as such. We strongly recommend that you seek legal advice from a lawyer that practices construction law.
