What should an HOA board do when a contractor files a lien on common area?

By OurHOA · General information · Revised September 26, 2026

A board's steps after a contractor or supplier files a mechanic's lien on HOA common area: deadlines to check, retainage, bonding off, and TX, FL, CO rules.

Part of the HOA board handbook: vendors, projects and upkeep.

The short answer

A mechanic's lien, called a construction lien in Florida, is a recorded claim against real property by someone who says they were not paid for work or materials that improved it. On common area it usually comes from a subcontractor or supplier the general contractor didn't pay, often after the association has paid the general contractor in full. Don't pay the claimant on the spot, and don't ignore it. Get the recorded document, check the claimant's notice and filing deadlines, and use what the association still owes the contractor to clear the lien. If the claim is disputed, the association can move the lien off the property with a bond, and in Florida it can force the claimant to sue within 60 days or lose the lien. Lien law runs on exact dates, and one missed deadline can decide the outcome for either side. Bring in the association's attorney before any formal step. Rules vary by state and by your governing documents, and this guide is education, not legal advice.

Why the association can end up paying twice

Subcontractors and suppliers never signed a contract with the association, but state law still lets them claim against its property. In Texas, Property Code section 53.101 requires the owner to hold back 10 percent of the contract price during the work and for 30 days after it is completed. If the association didn't, section 53.105 gives claimants who followed the rules a lien for at least the amount that should have been held. Once a subcontractor's notice of claim arrives, section 53.081 lets the owner withhold enough from the contractor to cover it. Under section 53.084, money paid to the contractor after that point can be recovered from the owner if the claim is perfected and reduced to judgment. Florida condominiums carry an extra risk. Section 718.121 says work on the common elements cannot be the basis for a lien on the common elements themselves. But when the association authorized the work, the lien can be filed against every unit in proportion to each owner's share of common expenses. One unpaid roofer can cloud the title of every unit in the building. Each owner can release their own unit by paying their proportionate share.

First week: read the lien and check the dates

Get a copy of the recorded lien from the county clerk and pull the project file: the contract, every pay application, lien waivers, and any notices the association received during the job. Note who filed, the amount, the work described, and the property description. A lien covering every lot on the plat for work on the pool is a point to raise with counsel. Then check the claimant's deadlines against the paperwork. Texas, chapter 53. A subcontractor or supplier must send the owner a notice of claim by the 15th day of the third month after the month the work was done, or the second month on a residential project. The lien affidavit must be filed by the 15th day of the fourth month after the claimant's last work, or the third month on a residential project, and a copy must go to the owner within five days of filing. The residential timeline covers owner-occupied homes and units owned by individuals, so association-owned common area will often fall under the longer one. Ask the attorney. Suit to foreclose must be filed within one year after the last day to file the affidavit, unless the parties agree in writing to extend it. Florida, chapter 713. A lienor who did not contract with the association must serve a notice to owner within 45 days of starting work, and missing it is a complete defense. The claim of lien must be recorded within 90 days after the claimant's final furnishing of work or materials, and it expires after one year unless the claimant sues. On a contract of $2,500 or less, only those who contracted directly with the association have lien rights, and an unlicensed contractor has no lien at all. Colorado, article 22 of title 38. The claimant must serve a notice of intent at least 10 days before filing, by personal service or certified mail. The lien statement must be recorded within four months after the claimant's last work or materials. Workers paid by the day or piece get two months after the project is completed. The lien lapses unless the claimant sues and records notice of the suit within six months after the last work or completion.

Clear it with the contractor's money

Most construction contracts require the contractor to keep the property free of liens from its subcontractors and suppliers and to defend the owner against them. Texas section 53.153 goes further and makes the original contractor defend a subcontractor's lien suit at its own expense. Call the contractor the day you learn of the lien, then send a written demand that cites that contract section and sets a short deadline, often 10 days, to get a recorded release. Meanwhile, hold what the association still owes. Keep retainage and any unpaid balance until the lien is released. Texas section 53.082 has the owner keep withheld funds until the filing deadline passes or the lien is satisfied or released. When the claimant is paid, Texas section 53.152 requires them to deliver a recordable release within 10 days of a written request. Joint checks payable to the contractor and the subcontractor are a common way to make sure the money lands where it should. In Florida, don't release final payment until the contractor gives the association the final payment affidavit required by section 713.06(3)(d). It lists every lienor who served a notice to owner and says whether each has been paid. In Colorado, section 38-22-127 makes money paid to a contractor on a construction project a trust fund for the subcontractors and suppliers who worked on it.

Disputed liens: bonding off and shortening the clock

When the amount is disputed, or the lien is holding up a loan, a closing or the next phase of the project, the lien can be moved from the property to a bond or cash deposit. The claimant then pursues the bond instead of the common area. In Texas, section 53.172 sets the bond at double the lien amount. If the liens total more than $40,000, it is the greater of one and a half times the liens or the liens plus $40,000. A licensed corporate surety must issue it, and it is filed and recorded with the county clerk. In Florida, section 713.24 allows a cash deposit or a surety bond equal to the claim plus three years of interest at the legal rate, plus $5,000 or 25 percent of the claim, whichever is greater. Florida also offers a cheaper step. Under section 713.22(2), the owner or its attorney can record a notice of contest of lien, and the claimant then has 60 days from service to sue or the lien is gone. In Colorado, section 38-22-131 requires a bond of one and a half times the lien plus costs, approved by a district court judge. The court clerk then issues a certificate of release to record under section 38-22-132. Ask the contractor to post the bond at its own cost.

Sample motion and owner update

A board motion can read: "Move that the board direct the president to send [contractor] written demand under section [number] of the [project] contract to obtain a recorded release of the lien filed by [claimant] on [date] within 10 days; to withhold $[amount] from retainage and remaining payments until a recorded release is received; and to authorize the association's attorney to review the lien's timeliness and, if needed, [record a notice of contest / arrange a bond] at a cost not to exceed $[amount]." Owners who are selling or refinancing will hear about the lien from a title company, and in a Florida condominium it may sit on their unit. A short update heads off rumors: "A subcontractor on the [project] has recorded a lien claiming it was not paid by our general contractor. The association paid the contractor under the contract and is holding the remaining balance. We have asked the contractor to resolve the claim and our attorney is reviewing it. If you are selling or refinancing and your title company asks, contact [name] at [email]." Timeline: within three days of learning of the lien, get the recorded copy and call the attorney and contractor. Pass the motion at the next meeting and send the demand. With no release by day 30, move to a bond or, in Florida, a notice of contest. Calendar the claimant's suit deadline and confirm the release or expiration appears in the county records.

How to avoid the next one

Collect a conditional lien waiver from the contractor with every pay application, and conditional waivers from the major subcontractors and suppliers. Get unconditional final waivers before releasing retainage. In Texas, sections 53.282 and 53.284 make a waiver unenforceable unless it substantially follows the statutory form, so use those forms. In Florida, record a notice of commencement before work starts on any job over $2,500, as section 713.13 requires, and keep a log of every notice to owner that arrives. The log tells you whose waivers you need before final payment. In Texas, record an affidavit of completion under section 53.106 when the job ends. It puts the completion date on record and warns claimants that they lose any lien on retainage if they miss the filing deadline. Our guide on HOA vendor contract red flags covers the lien and insurance clauses to require before anyone signs. Our guide on how to plan a major HOA project covers retainage and closeout.

Sources

These guides are general education for HOA boards and residents, not legal, tax, or financial advice. Rules vary by state and by your community's governing documents - check with a professional for your situation.

More on dues & money

Or browse all hoa dues, fees & money guides.