I am a contractor who never received payment for some home improvement work. What are my legal options against the homeowner?

When a homeowner fails to pay a contractor for the work he/she's done on their home, their immediate first thought is to go out and file a lien against the homeowner's property. This is a legal option that the contractor definitely can avail himself of.  The other option is of course to sue the homeowner for the amount of money he/she refuses to pay you.

In the case of the lien, mechanic liens are what are generally used by contractors. Mechanic liens are a legal recourse that helps guarantee payment for services provided by a contractor which improved someone else's property. It will depend upon what state you are in, but generally the law allows the contractor to file a mechanic's lien after a certain time period following the completion of the work that the payment has not been made. This puts pressure on the homeowner since he/she no longer has a clear title to his/her property until the debt is paid.

What began as a mechanic's method of receiving payment for car repairs, found its way into the world of construction. When a property owner employs a contractor to build or add to his property, the contractor may require licensed subcontractors like masons, and landscapers and carpenters. Each of these subcontractors are required to purchase supplies from outside vendors. They perform their tasks with the assumption that the property owner will pay the contractor who will in turn pay each of the subcontractors, who go on to pay their vendors. When projects like this are undertaken without a guarantee that things will work out as explained, the property owner has excessive leverage over the contractor. Should the property owner decide not to pay, the contractors and workers cannot legally go back and remove their work and supplies.  Legally it has become part of the property.

This sort of inequity in the building process is what has led to the popularity of a mechanic's lien for contractors and vendors. Now they don't finish the project hoping to be paid, they (the contractors) can threaten to use the mechanic's lien, which all by itself generally guarantees payment. In some states, contractors/vendors must first file a 20-day notice before moving ahead with an official mechanic's lien.

A mechanic's lien is not necessarily the quickest way to recoup money you are owed, but it does give you more security and legal protection than not filing one. Most contractors see filing a mechanic's lien as a last resort, but the other option is to sue the property owner.