Posted on January 3, 2012 2:36 pm

Colorado liens are governed my statute and provide an excellent means of protection when doing business in the state. However, there are very strict timelines and guidelines involved in pursuing a lien, and failure to properly handle a lien can result in loss of collection abilities. Liens are typically only used after attempted resolution of a business dispute.

Within a short period of time after a dispute, the party requesting the lien must give Notice of Intent to File a Lien to the non-paying party. This notice gives a set amount of time for the non-paying party to take care of their responsibilities. After the required time period passes, the requesting party may file a Lien Statement. Because a simple mistake in the process can cause you to have attorney fees and costs assigned to you, it is very important you seek the help of an experienced Colorado business and commercial litigation attorney. The two main types of liens are explained below:

Judgment Lien

A judgment lien is awarded after a trial or other court appearance in which a settlement is awarded by a judge for a lawsuit. A judgment lien can include monetary compensation, real or personal property. These liens will appear on your personal or business credit report as a judgment, and have a negative consequence in regards to credit scores.

Mechanic or Materialman Lien

Mechanic or materialman liens come into play after a service is completed or a product is delivered and not paid for upon demand. These liens are often used by mechanics for automotive repairs and the construction industry by subcontractors or material suppliers.