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Pennsylvania Lien Claim by Corporation

Pennsylvania Lien Claim by Corporation

Name: Pennsylvania Lien Claim by Corporation
Brand: US Legal Forms
Price: 59.00 USD
Rating: 4.72 (240 reviews)

Category:

Liens - Construction - Mechanics

State:

Pennsylvania

Control #:

PA-03A-09

Format:

Instant download

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Description

To perfect a lien in Pennsylvania, a contractor or subcontractor must file a lien claim with the prothonotary of the county in which the property is situated, within four (4) months after the completion of work. A notice of this filing must be served upon the property owner within (1) month of filing and an affidavit of said service must be filed within twenty (20) days of service.

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Key Concepts & Definitions

A lien claim by corporation refers to the legal right or claim a corporation can establish on assets for the repayment of debt. This typically arises when a corporation has provided services, goods, or loans, and the other party fails to fulfill their financial obligations. The lien acts as a security interest, allowing the corporation to hold or even sell the debtor's property as a form of repayment if necessary. Understanding lien claims can be crucial for managing corporate financial risks.

Step-by-Step Guide

Determine the Basis for the Lien: Identify whether the lien is for services rendered, goods supplied, or money owed.
Ensure Proper Documentation: Collect all contracts, invoices, and relevant communication that establish the debt obligation.
File a Lien Claim: Follow state-specific procedures to file a lien, which may involve submitting paperwork to a local court or a specific department.
Notify the Debtor: Send formal notification to the debtor indicating the lien's placement on their assets.
Resolve or Enforce the Lien: Negotiate with the debtor for payment or proceed with enforcing the lien through the sale of the assets, if necessary.

Risk Analysis

Filing a lien claim can come with various risks including potential legal challenges from the debtor, the burden of legal costs, and possible negative public relations impacts. Missteps in following legal procedures can invalidate the lien, resulting in financial losses. It's important to carefully consider whether the potential recovery justifies the risks associated with the lien enforcement process.

Pros & Cons

Pros:
- Security for Debts: Provides a way to secure payment.
- Legal Leverage: Enhances negotiation power against the debtor.
Cons:
- Costs: Legal and administrative costs can be significant.
- Reputation: Could affect relationships with clients and public image.

Best Practices

Ensure Accurate Documentation: Keep detailed records of all transactions and communications.
Understand Local Laws: Legal requirements for liens vary by state; ensure compliance with local regulations.
Consult Legal Professionals: Engaging with attorneys who specialize in lien laws can prevent costly errors.
Communicate Openly with Debtors: Often, open communication can resolve issues without needing to enforce the lien.

Common Mistakes & How to Avoid Them

Failing to Timely File: Liens have strict deadlines which, if missed, can invalidate the claim.
Not Verifying the Debt: Confirm that the debt is legitimate and the details are correct before proceeding.
Inadequate Notice to Debtor: Ensure all required notices are sent as missing notifications can also invalidate liens.

How to fill out Pennsylvania Lien Claim By Corporation?

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FAQ

Those who have the right to file a mechanic's lien in Pennsylvania are limited to second-tier subs and suppliers who have a claim of at least $500. In other words, anyone who contracted directly with the property owner, the prime contractor, or a subcontractor hired by the prime contractor are eligible for lien rights.

Tax Deed states auction off the real estate when property owners become delinquent. A Tax Lien state sells tax certificates to investors when homeowners become delinquent. Once the homeowner pays the taxes the investor is paid off their investment plus interest. Florida is a Tax Deed and a Tax Lien state.

Pennsylvania is one of the states that auction off property deeds when back taxes are left unpaid. Because the deed itself is sold at auction, investors take full possession of the property when they're the winning bidder.

1Fill out the Pennsylvania mechanics lien form. Fill out the PA lien form completely and accurately.2File your lien claim with the county recorder.3Serve a copy of the lien on the property owner.

According to Ted Thomas, an authority on tax lien certificates and tax deeds, 21 states and the District of Columbia are tax lien states: Alabama, Arizona, Colorado, Florida, Illinois, Indiana, Iowa, Kentucky, Maryland, Mississippi, Missouri, Montana, Nebraska, New Jersey, North Dakota, Ohio, Oklahoma, South Carolina,

When your efforts to collect a bill from a business that owes you money have been unsuccessful, you can place a lien on the assets of the business. As a lienholder, you gain legal rights to the company's property and the authority to sell the property and use the proceeds to repay what is owed to you.

1 Fill out an Abstract Of Judgment form.2 Bring or mail the two paper copies to the court.3 Bring or mail two copies of the Abstract Of Judgment to the county recorder where the judgment debtor's property is located.

Fill out the Pennsylvania mechanics lien form. Fill out the PA lien form completely and accurately. File your lien claim with the county recorder. Serve a copy of the lien on the property owner.

Failing to pay your real property taxes in Pennsylvania could lead to an upset tax sale or a judicial tax sale and the loss of your property.

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Lien Claim by Corporation

Note: This summary is not intended to be an all inclusive discussion of Pennsylvania's construction or mechanic's lien laws, but does include basic provisions.

What is a construction or mechanic's lien?

Every State permits a person who supplies labor or materials for a construction project to claim a lien against the improved property. While some states differ in their definition of improvements and some states limit lien claims to buildings or structures, most permit the filing of a document with the local court that puts parties interested in the property on notice that the party asserting the lien has a claim. States differ widely in the method and time within which a party may act on their lien. Also varying widely are the requirements of written notices between property owners, contractors, subcontractors and laborers, and in some cases lending institutions. As a general rule, these statutes serve to prevent unpleasant surprises by compelling parties who wish to assert their legal rights to put all parties who might be interested in the property on notice of a claim or the possibility of a claim. This by no means constitutes a complete discussion of construction lien law and should not be interpreted as such. Parties seeking to know more about construction laws in their State should always consult their State statutes directly.

Who can file a lien in this State?

Pennsylvania law permits contractors and subcontractors to claim a lien for labor or materials furnished in the erection or construction, or the alteration or repair of the improvement, provided that the amount of the claim shall exceed five hundred dollars ($500).

How long does a party have to file a lien?

Parties seeking to claim a lien must do so with the filing of a Lien Claim form within four (4) months of the claimant's last work. Thereafter, a lien claimant has two (2) years to bring an action to enforce the lien.

What kind of notice is required prior to filing a lien?

Subcontractors involved in the alteration or repair of property must file a Preliminary Notice of Intent to File Lien prior to the completion of work. Thereafter all subcontractors, even those involved in alteration or repair, must file a Formal Notice of Intent to File Lien at least thirty (30) days before a Lien Claim is filed.

By what method is a lien filed in this State?

A Lien Claim form is filed with the prothonotary of the county where the property is situated, and must be filed within four (4) months of the completion of work. Written notice of the filing must be served on the property owner within one (1) month after filing and recorded within twenty (20) days of service.

How long is a lien good for?

An action to obtain judgment upon a claim filed shall be commenced within two (2) years from the date of the filing.

Are liens assignable?

Pennsylvania statutes on construction liens do not specifically speak to whether liens may be assigned to other parties.

Does this State require or provide for a notice from subcontractors and laborers to property owners?

Yes. Subcontractors are required in some cases to provide two notices to the property owner in the form of a Preliminary Notice of Intent to File Lien for alterations and repairs and a Formal Notice of Intent to File Lien. In addition, Pennsylvania law provides that a contractor or subcontractor can issue a written waiver of all lien claims to the property owner.

Does this State require or provide for a notice from the property owner to the contractor, subcontractor, or laborers?

Pennsylvania law provides for a notice from the property owner to the contractor advising the contractor that a subcontractor has provided the owner with notice that a lien may be filed. The notice also demands that the contractor pay the claim or undertake to defend it.

Does this State require a notice prior to starting work, or after work has been completed?

No. Pennsylvania statutes do not require a Notice of Commencement or a Notice of Completion as required in some other States.

Does this State permit a person with an interest in property to deny responsibility for improvements?

No. Pennsylvania statutes do not have a provision which permits the denial of responsibility for improvements.

Is a notice attesting to the satisfaction of a lien provided for or required?

No. Pennsylvania statutes do not provide for or require that a lien holder who has been paid produce or file a notice to that effect.

By what method does the law of this State permit the release of a lien?

As stated above, Pennsylvania statutes have no specific provision for the release of a lien, other than the automatic dissolution that occurs if suit to enforce the lien is not brought within two (2) years. However, Pennsylvania law does permit a contractor or property owner to issue a written notice to a subcontractor demanding that the subcontractor file a lien claim within thirty (30) days of receipt of the notice or forever be barred from doing so.