When a contractor doesn't pay, your most powerful legal tool is a mechanics lien — but you can only use it if you've met your state's preliminary notice requirements before the dispute started. Most states require subcontractors to serve a preliminary notice within 20 days of first furnishing labor or materials (e.g., Cal. Civ. Code § 8200; Fla. Stat. § 713.06(2)(c); Ariz. Rev. Stat. § 33-992.01). Missing that window doesn't mean you're out of options, but it does eliminate your strongest one. Beyond liens, your escalation path includes formal demand letters, contractor license board complaints, prompt payment law claims, and small claims or civil court. The steps below follow that path in order, from fastest to most aggressive.
What Should You Do First When a Contractor Owes You Money?
Send a written payment demand immediately — not a phone call, not a text, a written demand via certified mail. Before you threaten legal action or file any paperwork, a formal demand letter is both your quickest path to payment and your first piece of evidence if this ends up in court.
Your demand letter should include:
- The exact amount owed, broken down by invoice or change order
- The contract or purchase order number
- The date work was completed or materials were last delivered
- A payment deadline — 10 to 14 days is standard
- A clear statement that non-payment will result in a mechanics lien filing, license board complaint, or legal action
Send it via USPS Certified Mail so you have a timestamped delivery record. Keep the green card or electronic receipt. Many contractors pay on the spot once they see a certified letter — not because they suddenly found the money, but because the paper trail signals you're serious.
Don't waste time with repeated phone calls first. Every day you spend chasing voicemail is a day closer to a lien deadline you might miss.
Does a Contractor Late Payment Trigger Any Legal Rights for Subcontractors?
Yes — most states have prompt payment statutes that impose mandatory interest on late payments and, in some states, allow you to recover attorney's fees. These laws exist specifically because slow payment is a systemic industry problem. According to Rabbet's 2024 Construction Payments Report, 82% of contractors face payment waits of over 30 days, up from 49% just two years earlier.
Key prompt payment laws by state:
- Florida: Under Fla. Stat. § 218.735 and § 713.346, payments from a GC to a sub are due within 10 days of the GC receiving payment from the owner. Late payments accrue interest at 2% per month.
- California: Cal. Bus. & Prof. Code § 7108.5 requires GCs to pay subs within 7 days of receiving payment. Violations can result in license suspension.
- Texas: Tex. Prop. Code § 28.004 requires payment to subs within 7 days of GC receipt of funds. Interest accrues at 1.5% per month on late amounts.
- Arizona: Ariz. Rev. Stat. § 32-1129.02 requires payment within 7 days of GC payment receipt; interest at 2% per month on overdue balances.
- Washington: RCW 60.28.030 and RCW 39.76.011 govern public and private project payment timelines respectively.
Document when you completed work, when you invoiced, and when the GC received owner payment. That timeline is the foundation of a prompt payment claim.
How Do You File a Mechanics Lien When a Contractor Refuses to Pay?
A mechanics lien is a legal claim recorded against the property that makes it impossible for the owner to sell or refinance until your debt is resolved. It's the most effective collection tool available to subcontractors — but it has hard deadlines and preliminary requirements that vary by state.
Step 1: Confirm your preliminary notice was served. Most states require this notice to be sent within 20 days of first furnishing. If you haven't served it yet, check your state's rules immediately — some states allow late service that protects work going forward. Use the lien deadline calculator to find your exact deadline based on your first-furnishing date and state.
Step 2: Determine your lien filing deadline. Deadlines run from either last furnishing of labor/materials or from project completion, depending on the state:
- Florida: 90 days from last furnishing (Fla. Stat. § 713.08)
- California: 90 days from completion of the project, or 60 days from a Notice of Completion (Cal. Civ. Code § 8412–8414)
- Arizona: 120 days from substantial completion (Ariz. Rev. Stat. § 33-993)
- Nevada: 90 days from last furnishing (NRS § 108.226)
- Washington: 90 days from last furnishing (RCW 60.04.091)
- Oregon: 75 days from last furnishing (ORS § 87.035)
Miss these deadlines and your lien rights are gone — permanently, with no exceptions.
Step 3: Prepare and record the lien. The lien must be recorded in the county recorder's office (or equivalent) where the project is located. It must include the property legal description, the amount claimed, the claimant's name and address, the name of the party who hired you, and the dates of first and last furnishing.
Step 4: Enforce the lien. Recording a lien doesn't automatically get you paid — you must file a lawsuit to foreclose the lien within a set period (typically 1 year in Florida, 90 days in California after recording). The lien puts pressure on the owner and the GC because it clouds the property title. Most disputes settle before foreclosure.
For state-specific deadlines across all eight states LienFlash serves, see the full reference at lien deadline directory.
What Is a Preliminary Notice and Why Does It Matter for Collecting Unpaid Construction Work?
A preliminary notice (also called a Notice to Owner, Notice of Right to Lien, or 20-day notice depending on the state) is a formal document you send at the start of a project to preserve your right to file a mechanics lien later. It is not a lien — it does not mean anything is wrong. It simply puts the property owner on notice that you're on the job and that lien rights apply.
If you didn't send a preliminary notice and the GC now refuses to pay, you may have lost your lien rights entirely. This is the most common and most expensive mistake subcontractors make.
The value of sending preliminary notices on every job — not just the ones that go sideways — cannot be overstated. According to Rabbet's 2024 Construction Payments Report, slow payments cost the U.S. construction industry an estimated $280 billion in 2024, adding roughly 14% to total construction spending. Protecting your receivables proactively is the only way to avoid becoming part of that number.
If you're a Florida sub, see Florida Mechanics Lien Guide for a complete walkthrough of the Notice to Owner process and lien timelines under Fla. Stat. § 713.06.
Can You File a License Board Complaint When a Contractor Owes You Money?
Yes, and it's often underused. Every state with a contractor licensing requirement has a licensing board with authority to discipline contractors — including suspending or revoking licenses — for non-payment of valid debts to subcontractors and suppliers.
This tool works because it hits the GC where it hurts most: their ability to work. A contractor under license investigation cannot easily bid on new public projects, and some bonding companies will cancel or refuse to renew bonds while a complaint is active.
How to file:
- California: Contractors State License Board (CSLB) — file online at cslb.ca.gov. The CSLB has authority under Bus. & Prof. Code § 7120 to discipline for financial irresponsibility.
- Florida: Florida Department of Business and Professional Regulation (DBPR) — file at myfloridalicense.com.
- Arizona: Arizona Registrar of Contractors — file at roc.az.gov.
- Texas: Texas Department of Licensing and Regulation or the relevant municipality's licensing office.
Include your written demand letter, the original contract, invoices, any payment communications, and your certified mail receipt when you file. The more documentation you have, the faster the complaint moves.
A license board complaint is not a substitute for a lien or a lawsuit — it's a parallel pressure strategy. Use both.
What Happens If You Take a Contractor to Small Claims or Civil Court?
Small claims court is your best option for disputes under a set dollar threshold — typically $10,000 to $25,000 depending on the state. You don't need an attorney, the filing fees are low (usually $30–$75), and cases are often heard within 30–60 days.
If your unpaid amount exceeds the small claims limit, you'll need to file in county or district civil court. At that level, retaining a construction attorney is strongly recommended. Look for attorneys who work on contingency for mechanic lien enforcement cases — many do, because the lien itself secures their fee.
Before you go to court, confirm:
- You have a written contract or a documented agreement (emails and texts count)
- You have all invoices, delivery receipts, and change orders
- You have documentation of the completed work (photos, inspection sign-offs, lien waivers you signed)
- You have a paper trail of your payment demands
Courts look favorably on plaintiffs who made genuine, documented attempts to resolve the dispute before suing. Your certified demand letters serve that purpose.
Note: winning a judgment doesn't guarantee you get paid. Collecting on a civil judgment against a contractor who is out of business or has hidden assets is its own challenge. This is why mechanics liens — which attach to real property — are often more effective than unsecured civil judgments.
How to Collect from a Contractor Who Has Stopped Communicating
When a contractor goes silent, escalate faster, not louder. Radio silence is often a sign of cash flow problems, legal exposure, or both — and it means you need to move to formal legal tools before assets disappear.
Immediate actions when a contractor stops responding:
Send a final demand letter via certified mail to both the contractor's business address and any personal address you have on file. State explicitly that lien filing, license board complaint, and/or legal action will commence within 10 days.
File your preliminary notice if you haven't already — or your mechanics lien if the preliminary notice window has passed and you're still within the lien deadline.
Contact the property owner directly. As a subcontractor, you have a right to communicate with the owner about unpaid work. Owners do not want liens on their property. In many cases, the owner will either pay you directly or pressure the GC to resolve the issue.
Check if the GC has a payment bond. On public projects and many large private projects, GCs are required to carry a payment bond (required under the Miller Act, 40 U.S.C. § 3131, for federal projects). If a bond exists, you can make a claim against it even if lien rights are limited on public property.
Research the GC's license and bond status. If their license has lapsed or their bond has been cancelled, document it and include it in your complaint.
95% of general contractors and 75% of subcontractors report frequently floating payments while awaiting developer disbursements, according to NetSuite's construction payment management research. That context doesn't excuse non-payment — but it does explain why you need legal tools that work independently of the GC's cash flow situation.
Frequently Asked Questions
How long do I have to file a mechanics lien after a contractor doesn't pay?
Deadlines vary by state and run from your last date of furnishing labor or materials. Florida gives you 90 days (Fla. Stat. § 713.08). California gives you 90 days from project completion or 60 days from a Notice of Completion (Cal. Civ. Code § 8412). Arizona is 120 days (Ariz. Rev. Stat. § 33-993). Oregon is 75 days (ORS § 87.035). Missing the deadline permanently eliminates your lien rights — there are no extensions.
Can I file a mechanics lien if I didn't send a preliminary notice?
In most states, no — or your rights are severely limited. California, Florida, Arizona, Nevada, Washington, and Oregon all require preliminary notice as a condition of lien rights. If you missed the notice window, you may still have prompt payment law claims, license board complaints, or civil court options available, but your most powerful tool is gone.
What if the GC claims they haven't been paid by the owner — do I still have rights?
Yes. "I haven't been paid yet" is not a legal defense to non-payment of a subcontractor under most state prompt payment statutes. Under Florida's prompt payment law (Fla. Stat. § 713.346) and California's Bus. & Prof. Code § 7108.5, payment to subs is required within days of GC receipt of owner funds. If payment is genuinely held up by the owner, that's a dispute between the GC and owner — not your problem to absorb.
Does sending a preliminary notice damage my relationship with the GC?
Rarely in practice. Experienced GCs understand preliminary notices are standard risk management, not accusations of bad faith. A GC who reacts negatively to a routine preliminary notice is signaling poor financial practices — which is information you want before you're owed money, not after. Sending notices on every job protects your business without singling anyone out.
Can I sue a contractor personally, not just their company?
Possibly. If the contracting entity is an LLC or corporation but the owner personally guaranteed the contract, or if there is evidence of fraud or piercing the corporate veil (e.g., commingling funds, no real separation between the owner and the business), you may be able to pursue the owner personally. This requires an attorney's analysis of the specific facts.
How much does it cost to file a mechanics lien?
County recording fees typically run $15–$50 per page. The larger cost is preparation — using an attorney can cost $500–$1,500. Services like LienFlash handle the full process, including attorney-reviewed form completion and USPS Certified Mail filing, for $24.99 per notice. On a $15,000 unpaid contract, that's a fraction of a percent of what's at stake.
What is a stop payment notice and how is it different from a mechanics lien?
A stop payment notice (available in California under Cal. Civ. Code § 8520 and a handful of other states) is sent to the construction lender or the owner, requiring them to withhold funds from the GC equal to your unpaid amount. Unlike a lien, it doesn't attach to the property — it intercepts the money flow. It's most effective on projects with active financing. In California, subcontractors can use both a mechanics lien and a stop payment notice simultaneously.
What if the contractor is out of business?
Check whether the GC had a contractor's license bond — license bonds exist specifically to pay claims from subcontractors and suppliers when the contractor fails to pay. In California, licensed contractors are required to maintain a $25,000 bond (Bus. & Prof. Code § 7071.6). File a bond claim with the bonding company with documentation of the debt. Also check whether there is a payment bond on the project (separate from the license bond), especially on public works projects.
Protect Your Lien Rights Today
The window to protect yourself closes fast — and it closes whether or not you're in a payment dispute yet. The contractors who collect on unpaid work are the ones who sent their preliminary notices on day one, before anything went wrong.
Use the LienFlash deadline calculator to find your exact filing deadline based on your state and first-furnishing date:
If you're ready to file a preliminary notice now, you can complete the form in about 2 minutes and we handle the USPS Certified Mail with a Certificate of Mailing you can use in court.