What a mechanic's lien discharge bond is
When a contractor, subcontractor or supplier records a mechanic's lien on a property, the owner or general contractor can post a bond to release the lien. The claim then moves from the property to the bond, so the property can be sold or refinanced while the dispute is settled.
In Wisconsin
Under Wis. Stat. § 779.08, an owner or other interested party can release a construction lien by filing a surety undertaking, or depositing money, a certified check or government bonds, equal to 125 percent of the lien claim. Once the court approves the substitute security, the clerk removes the lien from the judgment and lien docket.
- The lien claimant can object to the surety, and the court decides the objection.
You need this bond if you're
- A property owner facing a mechanic's lien
- A general contractor whose subcontractor or supplier filed a lien
- A developer who needs clear title to sell or refinance
- A lender that requires the lien removed before funding
What the surety looks at
The lien, the dispute behind it and your finances. Because the bond can pay out if the claimant wins, sureties often look closely at the dispute.