North Carolina property owners will be required to take an additional step in the building permit process after the recent implementation of the state’s new construction lien law.

SL2012-158 requires property owners or their contractors to appoint a lien agent from a title company registered on a state list of agents before a building permit can be approved.

According to the North Carolina Home Builders Association, the law was designed to prevent “hidden liens” — or claims by a subcontractor or supplier on a project — that may be filed after a property is sold.  It was a response to lawsuits and losses resulting from hidden liens on new construction.

The new law exempts construction projects under $30,000, or improvements made to an owner-occupied single-family residence (e.g. remodeling), or for public building projects.

The new law went into effect on April 1.

The lien agent will track contractors and subcontractors who choose to file a notice that they are “on the job” and want to preserve their lien rights in the property being improved.

A new online application, LiensNC.com, will provide buyers, lenders, closing attorneys, owners, contractors and subcontractors a system for identifying who has lien rights for new construction projects.

A three-step process allows owners or contractors to log into the LiensNC.com system, complete the Appointment of Lien Agent form, and pay a required fee of $25 for 1-2 family dwellings and $50 for commercial projects.  The form must then be presented to the Building Inspector before a building permit can be issued.

More details on the North Carolina lien law can be found at the LiensNC.com website.

– article submitted by the Polk County Planning Department