What is a Notice of Commencement?

WARNING PROPERTY OWNERS

The Notice of Commencement provides notice of the intention to begin improvements to property, it provides the location of the property, description of the work and the amount of bond, if any. It also identifies the property owner, contractor, surety, lender and other pertinent information. Failure to record a Notice of Commencement or incorrect information could contribute to your having to pay twice for the same work and materials.

Before you start any construction project on your property or on your home, it is important that you understand that it is the owner’s mandatory duty (or lender’s duty in the event of a construction loan) to record a Notice of Commencement prior to starting construction improvements to your property. There are exceptions; below are a couple of those exceptions:

1. A contract is for less than $2500.00;

2. A contract for HVAC repair or replacement having a total value less than $7500.00.

When an application for building permit is made, the issuing governmental agency shall provide the applicant and the owner a printed statement from the Department of Business and Professional Regulation. You must record the form with the Clerk of Court where the property is being improved and post a certified copy at the job site.

Construction Lien Law is complex, and cannot be covered completely in this blog. You can find more information here, and we highly recommend that whenever a specific issue arises, you consult an attorney directly!

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