What can a sub-contractor do if they are not paid after a construction loan is disbursed?

A sub-contractor has the right to file a lien against the home as a way to secure their unpaid debts. This legal claim is called a mechanic's lien, which is commonly used in the construction industry to ensure that those who contribute labor or materials to a project get paid. By filing a lien, the sub-contractor can establish a legal right to the property, effectively placing a hold on it until payment is received. If the homeowner or general contractor fails to pay, the sub-contractor may have a legal pathway to seek restitution through the sale of the property.

While filing a lawsuit, negotiating with the contractor, or requesting arbitration may also be viable options, they do not directly provide the immediate legal claim to the property that a lien does. Other methods may involve more time and may not result in immediate payment. Filing a lien is specifically designed for the construction context where payment disputes are common, allowing subcontractors to protect their interests in the project directly through the real estate involved.