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California Mechanic's Lien Interest - Can a subcontractor charge interest on a mechanic's lien?Summary: Subcontractors (and Original Contractors and Suppliers) may be entitled to charge interest on a mechanic's lien
ANSWER: If the lien is foreclosed upon, the foreclosure award will include 10% interest on the principal amount. That's the only rule. Subcontractors often demand interest on their lien when asking for payment in satisfaction of the lien. It can be argued that the right to interest does not vest until a foreclosure award is entered after trial in a lawsuit to foreclose upon the lien, and that such a demand for interest in the payoff demand is inappropriate. However, the fact that interest would be added to the judgment may entitle the claimant to interest in addition to the payoff amount. Back to the top of this page: California Mechanic's Lien Interest To: Frequently asked questions for California construction law answered by Attorney David J. Barnier To: Ask Attorney Dave your California construction law question(s) To the home page: Download Construction Forms |
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