Contractor's Mechanic's Lien Services
Glossary of Construction Collection Terms
A payment Plan is a written agreement signed by the judgment creditor or the assignee, and the judgment debtor to pay the amount owed over time. Sometimes Payment Plans incorporate a provision that grants the forgiveness of a portion of the debt if the judgment debtor complies with the terms. All collection action ceases during the period that payments are being made.
A performance bond quarantines that the principal, usually the original contractor, will complete the work under the terms of the construction contract.
Preliminary 20-day Notice
A preliminary notice is a notice required to be served as a prerequisite to filing a mechanics lien.
A process server is a person licensed or authorized by law to serve legal documents on another party.
Real Property or Real Estate
Real property consists of land and the improvement on the land.
Statute of Limitation
A statute that limits the time within which a lawsuit can be filed to enforce a claim.
A stop notice freezes undisbursed funds held by a construction lender for the benefit of a claimant. Stop notices require a bond.
A subcontractor is a contractor who has a contract with an original or prime contractor, or another subcontractor as opposed to the owner. When a subcontractor has a contract with an original or prime contractor, the contract is referred to as a second-tier contract. When a subcontractor has a contract with another subcontractor, the contract with another subcontractor, the contract is referred to as a third-tier contract. A subcontractor may become a claimant.
Surety, Surety Bond
A surety or bonding company is a company that assumes the responsibility for the debt or obligation of another party. A surety bond has at least three parties: (1) the oblige or the party who is the recipient of an obligation, (2) the principal or the party who is to perform a contractual obligation, and (3) the surety or party who assures the obliges that the principal can perform the task. Bonding companies issue payment bonds, performance bonds, and other types of guarantees.