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It's easy to think about sending a preliminary notice only when a customer account goes unpaid. After all, why stress about it if everything seems fine, right? Unfortunately, that strategy can seriously backfire.
Preliminary notices are an essential tool to protect your right to file a mechanics lien, and waiting until an account is overdue could mean missing your chance. Here’s why you can’t afford to delay sending these notices, and why trying to play catch-up is a recipe for disaster.
Most supplier accounts operate on a NET 15 or NET 30 basis, meaning payment is due 15 or 30 days after delivering the materials. If you wait until an account is overdue to send a preliminary notice, you’re already at least 16 or 31 days past your first delivery date. In many states, that’s too late.
For example:
If you wait until the account is overdue, you're likely missing these deadlines altogether, which means you're losing your lien rights. And the reality is, even if you intend to send the notice the day after an account goes overdue, delays will happen—whether it’s due to weekends, holidays, or just the everyday chaos of running a business.
The other big issue with only sending preliminary notices when an account goes unpaid is that this segmented approach makes mistakes more likely. If you’re scrambling to learn the rules of every state, figuring out deadlines, and rushing to send notices on a case-by-case basis, it’s a recipe for errors. State laws are complex, and each has its own nuances and deadlines.
A better approach is to have a consistent, systemized process for sending out notices every time you supply materials, regardless of whether the account is current or overdue. This way, you're not rushing to file forms under pressure, and you're not risking losing your lien rights.
Sending a preliminary notice isn’t a hassle—it’s a safety net. Waiting until an account is overdue before sending a notice might seem like an easy way to reduce paperwork, but it’s a risky move that could cost you big time. Instead, get into the habit of sending preliminary notices on time, every time.
By having a solid lien and notice process in place from the start, you’ll always be protected if payment issues come up later. Don’t fly too close to the sun by waiting—it’s just not worth the risk.
