The Iowa Mechanic Lien Law under §572 Iowa Code was revised effective January 1, 2013. The roll out was and is by all accounts a huge success. The success can be attributed to the Secretary of State office and Matt Schultz, Iowa Secretary of State and his extremely competent staff.
Secretary of State Schultz and members of his staff have answered hundreds of phone calls, sent out hundreds of Form Packets and have spoken at scores of seminars and events focused on insuring a smooth transition from the county-based filing system to the statewide filing system.
Mechanic Notice and Lien Registry (MNLR)
The most significant change requires that all Mechanic Lien filings be filed in the Secretary of State office as of January 1, 2013, as opposed to filing at the local County Clerk of Court’s office, which was the system used for many years.
The statewide repository known as the MNLR does not eliminate the necessity for the General or Subcontractor to designate a specific County, job site or project to which the lien is to be attached. The MNLR is to be utilized for all mechanic lien filings concerning both residential and commercial construction.
The other §572 major revision involves residential construction. Specifically, the General Contractor is now required to file a Commencement Notice within 10 days of the start of work on the job site. The Commencement Notice is posted on the Secretary of State website. Failure of the General Contractor to file the Commencement Notice within the 10 day time limit puts the General Contractor lien in jeopardy.
A Subcontractor must file a Preliminary Notice which connects the Subcontractor to the project through an identification number assigned by the Secretary of State for the specific project/job.
In the event that the General Contractor has not filed the notice of commencement within 10 days of the commencement of work on the property, a Subcontractor can file the Notice of Commencement filing to get a Project Record Number for the project/job site in question. This number is very important and needed to file any lien.
A Subcontractor failure to file a Preliminary Notice may result in the forfeiture of any Mechanic Lien if the General Contractor is paid before the filing of the Preliminary Notice.
The intent of the law is to centralize all of the Mechanic Lien filings in the State and streamline the process with online filings. In order to facilitate the online aspect, General Contractors and Subcontractors must create an online account with the Secretary of State. All necessary forms can be downloaded from the Secretary of State website.
To assist General and Subcontractors that may not be fully computerized or have online capabilities, the Secretary of State will accept paper filings mailed or hand delivered to them. Priority of liens is based on time and date of filing, and online filings are the preferred method to file to ensure priority of your lien.