Construction liens and builder disputes for Michigan homeowners
I am Mitchell Bisson, a Grand Rapids real estate lawyer. I have litigated for over 15 years. A construction lien dispute usually starts with a piece of paper: a claim of lien recorded against your house by a contractor, or by a subcontractor or supplier you never hired. This page covers construction liens and builder disputes for Michigan homeowners, including what the Construction Lien Act requires of someone who claims a lien on your home, how an owner answers one, what a missing license does to a builder’s claim, and how long a homeowner has to sue over bad work. I handle these matters on the homeowner side. The short answers below come from my Michigan legal library.
In Kent County, these disputes usually take one of three shapes. A contractor says it was not paid in full and records a lien. A subcontractor or supplier says the general contractor did not pay it, and the lien lands on a homeowner who already paid. Or the work was poor, unfinished or done by an unlicensed builder, and the homeowner wants money back or the work fixed. The governing statute is the Construction Lien Act, MCL 570.1101 and following. I work from the current text on the Legislature’s website and not from an older summary or a contractor’s form.
The Act’s homeowner protections are written around a defined term. A “residential structure” is an individual residential condominium unit or a residential building with no more than two residential units, together with the land, where the owner or lessee who contracted for the work lives or will live when the work is done. MCL 570.1106(4). A rental building or a house the owner will not occupy may not get the homeowner rules described below, and I check that first.
The central rule is a plain one. A contractor does not have a right to a construction lien on an owner’s interest in a residential structure unless the contractor worked under a written contract with the owner, with any amendments also in writing, and the contract carries the license statements the Act requires. MCL 570.1114. The Act is to be liberally construed, and it says substantial compliance with its provisions is sufficient for the validity of the liens it provides for. MCL 570.1302(1). What counts as substantial compliance depends on the defect. In Stokes v. Millen Roofing Co., the Michigan Supreme Court declined to extend that protection to a builder that held no license and so could not have completed the lien form properly. 466 Mich. 660, 668 (2002). I do not promise outcomes. I do promise to tell you where you stand.
Michigan construction lien and builder dispute rules, time limits and key points
These are the rules in the statutes and the case law. How they apply to your house depends on the contract, the payments and the dates.
| Claim or issue | What must be shown | Time limit or key rule | Authority |
|---|---|---|---|
| Contractor’s lien on a home | A written contract with the owner, amendments in writing, and the required license statements | No written contract, no lien right on a residential structure. The Act says substantial compliance is sufficient for the validity of a lien | MCL 570.1114; MCL 570.1302(1) |
| Claim of lien and service | A claim of lien recorded with the register of deeds, with proof of service of the notice of furnishing attached by a subcontractor, supplier or laborer | Recorded within 90 days after the last furnishing of labor or material, or the lien right ceases. Copy served within 15 days after recording | MCL 570.1111(1), (4), (5) |
| Foreclosure suit | A circuit court action in the county where the property is located, with a lis pendens recorded and every affected interest holder made a party | Not later than 1 year after the claim of lien was recorded. The action is equitable in nature | MCL 570.1117(1), (2), (4); MCL 570.1118(1) |
| Owner’s affidavit of payment | The owner files an affidavit that the contractor was paid under the contract, with the contract, change orders and proof of payment attached | The lien does not attach to a residential structure to the extent of the payments. With no written contract as section 114 requires, filing the affidavit creates a rebuttable presumption of payment that only clear and convincing evidence can overcome | MCL 570.1118a(1)-(2) |
| Sworn statements and waivers | Contractor gives a sworn statement when payment is due or on demand. A claimant paid in full gives a full unconditional waiver | No reliance on a sworn statement against a claimant who gave a notice of furnishing or whose notice of furnishing is excused. On a home, an owner may not rely on a waiver signed by someone other than the claimant without first verifying it, if the claimant filed a notice of furnishing or is excused from filing one | MCL 570.1110(1), (8); MCL 570.1115(2), (7) |
| Unlicensed builder | A residential builder or maintenance and alteration contractor not licensed during the work | Cannot sue for compensation or impose a lien, but may defend. No private cause of action for the homeowner under the statute | MCL 339.2412(1), (3); Stokes v. Millen Roofing Co., 466 Mich. 660, 666-668 (2002); Epps v. 4 Quarters Restoration LLC, 498 Mich. 518, 535-536 (2015) |
| Defective work | Property damage or breach of contract caused by the builder’s work | 3 years for injury to property, 6 years for most contract claims, and a repose bar of 6 years after occupancy, use or acceptance (gross negligence: 1 year after discovery, no more than 10 years) | MCL 600.5805(2), (14); MCL 600.5807(9); MCL 600.5839(1) |
| Complaint to the state about a licensed builder | Abandonment, diversion of funds, or workmanship below the Michigan residential code | Within 18 months after the latest of completion, occupancy or purchase (maintenance and alteration contract), or the certificate of occupancy or closing (project requiring an occupancy permit) | MCL 339.2411(1), (2) |
The 90 days and the 1 year are separate clocks. The first runs from the last furnishing of labor or material and decides whether a lien exists at all. The second runs from recording and decides whether the claimant can still ask a court to enforce it. I write down both dates on the first day.
What a lien claimant has to do before it can foreclose on your home
A contractor who dealt with you directly. The contractor needs the written contract described above. It must then record a claim of lien within 90 days after its last furnishing of labor or material and serve a copy within 15 days after recording, personally or by certified mail, on the designee named in the notice of commencement, or on the owner if there is no designee. Proof of that service is attached to any complaint, cross-claim or counterclaim filed to enforce the lien. MCL 570.1111(1), (5). A contractor must also give you a sworn statement. If it did not give one before recording, the lien is not invalid, but the contractor is not entitled to payment, and no complaint or counterclaim to enforce the lien may be filed, until the sworn statement has been provided. MCL 570.1110(9).
A subcontractor or supplier you did not hire. A subcontractor or supplier ordinarily has to serve a notice of furnishing on the designee and the general contractor within 20 days after furnishing its first labor or material. MCL 570.1109(1). A late notice does not defeat the lien for work done before the notice, except to the extent the owner made payments to the contractor on a sworn statement or a waiver of lien. MCL 570.1109(6).
The notice of commencement on a home. An owner who contracts for an improvement to a residential structure must prepare and provide a notice of commencement to a contractor, subcontractor, supplier or laborer who asks for one in writing, within 10 days after the date the request was mailed by certified mail. MCL 570.1108a(1), (5). If the owner does not provide it on request, the time for a subcontractor or supplier to give its notice of furnishing runs until 20 days after the notice of commencement is actually furnished. MCL 570.1108a(9). Answer that letter on time.
How owners protect themselves while the work is under way
Most of the owner’s protection is paperwork done before the last check. A contractor must give the owner a sworn statement listing each subcontractor and supplier, and each laborer owed wages, when payment is due or when the owner demands it. After receiving one, the owner may withhold enough to pay what the statement shows is owed, and may pay those people directly. MCL 570.1110(1), (4), (7). An owner may rely on a sworn statement to avoid a claim, but not against a subcontractor, supplier or laborer who gave a notice of furnishing as the Act requires or whose notice of furnishing is excused. MCL 570.1110(8). A lien claimant who is paid in full must give a full unconditional waiver, and on a home the owner may not rely on a waiver signed by someone other than the claimant, where the claimant filed a notice of furnishing or is excused from filing one, without first verifying it with the claimant in writing, by telephone or in person. MCL 570.1115(2), (7). A contract may not require a lien waiver in advance of work, and one obtained that way is invalid except to the extent payment was actually made. MCL 570.1115(1).
Defenses and answers I look at in a construction lien case
Was there a written contract with the license statements? If the claimant is a contractor and the contract was oral, or changes were not in writing, the right to a lien on a residential structure is in doubt under MCL 570.1114. Because the Act treats substantial compliance as sufficient for validity, I look at what the document says and what you were told.
Did you already pay, and is the amount right? The owner’s affidavit under MCL 570.1118a says the claim of lien does not attach to a residential structure to the extent the owner paid the contractor according to the contract. I assemble the contract, change orders, canceled checks and receipts first, because the statute ties the attachments to the contract, change orders and whatever evidence of payment the owner has. A lien may not exceed the claimant’s contract amount less payments made on the contract, and the total of all liens on a property is capped as well. MCL 570.1107(1), (6).
Who pays attorney fees? In a foreclosure action, the court examines each claim and defense and decides the amounts due and the priorities. It may allow reasonable attorney fees to a prevailing lien claimant, and it may allow them to a prevailing defendant if it finds the lien claimant’s action to enforce the lien was vexatious. MCL 570.1118(2). That cuts against owners who lose, so I raise it before we decide whether to contest a lien.
Getting a lien off your title
A recorded claim of lien clouds title whether or not it is valid, and it can block a sale or a refinance. One way to clear it is payment, settlement or a recorded discharge. Another is to post a bond. A claim of lien may be vacated and discharged at any time if a bond naming the lien claimant as obligee is filed with the county clerk and a copy is given to the claimant. The bond is for twice the amount of the lien, and it may be a cash bond or a surety bond from a company authorized to do business in Michigan. Once the clerk’s certificate is recorded, the claim of lien is discharged. MCL 570.1116(1)-(2). A foreclosure proceeding may not be brought later than 1 year after the claim of lien was recorded. MCL 570.1117(1).
When the builder was not licensed
A residential builder is a person who, for compensation other than wages for personal labor only, undertakes to build, repair, alter or improve a residential structure, and a residential maintenance and alteration contractor does repairs, alterations, garages and concrete on residential property. MCL 339.2401(a)-(b). The Occupational Code defines “residential structure” for licensing purposes on its own terms, as a detached one- or two-family dwelling or a townhouse of not more than three stories, with related facilities, so that definition is not the same as the one in the Construction Lien Act and I check each. MCL 339.2401(c). The exceptions in MCL 339.2403 include an owner working on the owner’s own home, so I read them before saying a builder needed a license.
What the statute takes away from the builder. A residential builder or maintenance and alteration contractor may not bring or maintain a court action for compensation for work that required a license without alleging and proving that it was licensed during the work, and may not impose or take legal action to impose a lien on real property unless it was licensed during the work. MCL 339.2412(1), (3). In Stokes, an unlicensed roofer recorded a lien on the homeowners’ title after they refused to pay. The homeowners sued to clear title, and the roofer counterclaimed for breach of contract, quantum meruit and foreclosure of the lien. The Michigan Supreme Court held that the lien was properly extinguished because it was invalid and unenforceable, and that the statute barred the roofer from seeking compensation under its contract with the homeowners. 466 Mich. 660, 662-663 (2002).
What it does not do. The Supreme Court summarized the statute in Epps: it bars an unlicensed builder’s claims to collect compensation, it does not prevent the builder from defending on the merits against a homeowner’s action to recover sums already paid, and it does not create a private cause of action for the homeowner. 498 Mich. 518, 535-536 (2015). A homeowner who wants a refund therefore needs another legal theory, such as breach of contract, and has to prove it.
The license must exist during the work, not on signing day. In Edgewood Development Inc. v. Landskroener, the homeowners argued that the builder had to hold a license when the contract was signed. The Court of Appeals disagreed. It read the statute to ask whether the builder was licensed during the performance of the contract, and because the builder held a license during the work, the licensing statute did not bar its suit for compensation. 262 Mich. App. 162, 167-168 (2004). So I get the license history, with dates, for the whole job.
Defective or unfinished work: the claims and the clocks
Three different periods can apply. The general period for injury to property is 3 years. MCL 600.5805(2). A claim for breach of contract has 6 years. MCL 600.5807(9). Beyond both, a person may not maintain an action for damages arising out of the defective or unsafe condition of an improvement to real property against a contractor who made the improvement unless it is brought within 6 years after occupancy, use or acceptance, or, if the defect is the proximate cause of the damage and resulted from gross negligence, within 1 year after the defect is or should have been discovered, but not more than 10 years after occupancy, use or acceptance. MCL 600.5839(1). The periods in section 5805 are expressly subject to that repose bar. MCL 600.5805(14). Fraudulent concealment can extend the time to 2 years after discovery. MCL 600.5855. Which clock controls turns on how the claim is framed.
No implied warranty when you hire the builder on your own land. The Court of Appeals held in Smith v. Foerster-Bolser Construction, Inc. that the implied warranty applies only to the sale of new homes by a builder-vendor as part of a real estate transaction, not where the owner hires a general contractor to build on land the owner already holds. The court reasoned that such an owner can negotiate express warranties into the contract. 269 Mich. App. 424, 430-431 (2006). That puts weight on the written contract, including any arbitration or other dispute procedure, which I read before choosing where to file.
Door-to-door contracts and consumer protection claims
The three-day right to cancel. Roofing and siding contracts are often sold at the door after a storm. Under the Home Solicitation Sales Act, a sale of goods or services of more than $25 is a home solicitation sale when the seller solicits the buyer and the buyer’s agreement or offer is given at home. MCL 445.111(a). The buyer may cancel until midnight of the third business day after signing an agreement that complies with the Act. MCL 445.112(1).
A 2026 decision limits the Act. In Mills Siding and Roofing, LLC v. Rosario, a published Court of Appeals decision issued over a dissent, the court held that the Act did not apply to a roofing contract the homeowner signed at least two weeks after a door knocker’s visit, and it declined to set a bright-line rule for how much time may pass. No. 372914 (Mich. Ct. App. June 22, 2026), read the opinion.
The Consumer Protection Act after Eli Lilly. A person who suffers a loss from a violation of the Michigan Consumer Protection Act may bring an action for actual damages or $250, whichever is greater, with reasonable attorney fees. MCL 445.911(2). The Act does not apply to a transaction or conduct specifically authorized under laws administered by a regulatory board or officer. MCL 445.904(1)(a). Liss v. Lewiston-Richards, Inc. had applied it to a residential home builder. 478 Mich. 203 (2007). On July 31, 2026, in Attorney General v. Eli Lilly and Company, the Michigan Supreme Court overruled Liss and held that a court must first identify the specific transaction or conduct the plaintiff says violates the Act, then decide whether that specific transaction or conduct is specifically authorized by law. No. 165961 (Mich. July 31, 2026), read the opinion. Eli Lilly did not decide any home builder’s case. I do not treat a consumer protection claim against a builder as either available or foreclosed. I look at the specific conduct and plead it with that test in mind.
How I handle a construction lien or builder dispute
- Fix the dates. I record when the work started, the last day anyone worked, when the claim of lien was recorded and served, and the date of occupancy.
- Read the contract and the claim of lien together. I check whether the contract and any changes are in writing, what license statement it carries, and whether the claim of lien matches the contract amount and the payments.
- Check the license. I look up the license status for the whole period of the work.
- Build the payment record. I collect checks, receipts, sworn statements and waivers, and I identify every subcontractor and supplier named on them. If an affidavit under section 118a fits, I prepare it with the attachments the statute requires.
- Decide how to clear the title. Depending on the sale or refinance schedule, we weigh settlement, a bond under section 116, or contesting the lien in a foreclosure action.
- Answer the claim and bring yours. I draft the defenses and any counterclaim for defective work or a refund, framed against the clocks above.
- Motions, mediation and trial. Some lien cases can be decided on motion once the documents are in. If a case does not resolve, I am prepared to try it.
Ways a construction lien or builder dispute may end without a trial
Many lien disputes end by agreement. A claimant who sees that its contract, license or deadlines are weak may record a discharge, sometimes in exchange for a payment and a release. A negotiated payment conditioned on a recorded discharge and a full waiver ends the lien and protects you from the next subcontractor. A bond under section 116 clears the title and leaves the money fight for the court. In a defective work case, the builder or a replacement contractor may agree to correct the work, with a payment adjustment and a mutual release. Whether any of these is available depends on the facts, the documents and the other side. None is automatic.
What I need from you
Bring the contract, every change order and every estimate, and the claim of lien or any letter from a contractor, subcontractor or supplier. Bring proof of every payment: canceled checks, receipts, bank or card statements. Bring any sworn statements and lien waivers, the notice of commencement if you filled one out, the permit and certificate of occupancy, and the contractor’s license number. Bring photographs of the work, any inspection report, and every text and email with the builder. Write down the date the work started, the last day anyone worked, and the date you moved in. Do not make a final payment or sign anything a contractor hands you until we have talked. Do not ignore a lawsuit, and do not post about the dispute online.
Where your Kent County construction lien case will be heard
I represent clients in Grand Rapids, Kentwood, Grandville, Wyoming and across Kent County. An action to enforce a construction lien through foreclosure is brought in the circuit court for the county where the real property described in the claim of lien is located, and it is equitable in nature. MCL 570.1118(1). For a Kent County home, that is the 17th Judicial Circuit. Under MCL 600.8301(1), the district court has exclusive jurisdiction in civil actions when the amount in controversy does not exceed $25,000. Kent County district courts include the 61st District Court in Grand Rapids, the 59th in Walker and Grandville, the 62A in Wyoming, the 62B in Kentwood and the 63rd for Rockford, Lowell, Cedar Springs, East Grand Rapids and the surrounding townships. A homeowner’s claim for a refund or defective work can fall in either court depending on the amount. I look at where your house is and what is being claimed before I tell you where a case belongs.
Why people hire me for a Michigan construction lien matter
You work directly with me, the lawyer handling your case. I give you the strengths and weaknesses of the case straight, including what it could cost you and what it could protect. I build the case the facts support, and then we decide together how to proceed.
Fees depend on the type of case, its complexity and whether it is likely to go to trial. I explain my fee arrangement at the consultation, before you decide whether to hire me.
Questions I hear from people with a construction lien or builder dispute in Michigan
Can a contractor put a construction lien on my home if we never signed a written contract?
Under MCL 570.1114, a contractor does not have a right to a construction lien on an owner’s interest in a residential structure unless the work was done under a written contract between the owner and the contractor, with any amendments or additions also in writing. The written contract must contain statements about contractor licensing.
What deadlines apply to a construction lien on my home in Michigan?
A contractor’s lien right ends unless a claim of lien is recorded within 90 days after the claimant last furnished labor or material. The claimant must serve a copy within 15 days after recording, and must start a foreclosure action within 1 year after recording the claim of lien. The action must be accompanied by a notice of lis pendens.
I paid my contractor in full, but a subcontractor recorded a lien. Do I owe again?
Not necessarily. Under MCL 570.1118a, a claim of lien does not attach to a residential structure to the extent the owner paid the contractor under the contract, if the owner files an affidavit with the court stating the payment and attaches the contract, change orders, and evidence of payment such as canceled checks.
Is there a state fund that pays if my contractor takes my money and does not pay the subcontractors?
Not any longer. Michigan’s homeowner construction lien recovery fund was repealed by 2010 PA 147, and MCL 570.1201 and the related sections now show as repealed. In its place, 2010 PA 147 added MCL 570.1118a, the owner affidavit procedure under which a lien does not attach to a residential structure to the extent the owner has paid the contractor.
Does a contractor working on my house need a Michigan license?
Usually, for paid work on a house. MCL 339.2401 defines a residential builder and a residential maintenance and alteration contractor, and MCL 339.2403 lists exemptions, including owners working on their own home and a single project with an aggregate contract price under $600. Licensed electrical, plumbing, and mechanical contractors are licensed under other statutes for their own trades.
Can an unlicensed contractor sue me for payment or record a lien against my home?
No, if a license was required. MCL 339.2412 bars a residential builder or residential maintenance and alteration contractor from bringing or maintaining a court action to collect compensation without alleging and proving licensure during the work. Subsection (3) also bars imposing a lien on real property unless licensed during the work.
If my contractor was unlicensed, can I sue under the licensing statute to get my money back?
Not under that statute alone. In Epps v 4 Quarters Restoration, the Michigan Supreme Court held that MCL 339.2412(1) does not create a private cause of action for a homeowner against an unlicensed builder. It also held that a contract between an innocent homeowner and an unlicensed builder is voidable by the homeowner rather than void, so the contract is not automatically a nullity.
How long do I have to sue a builder for defects in my home?
For property damage from a defective improvement, the 3-year period in MCL 600.5805(2) applies, and MCL 600.5839 separately bars suit against a contractor more than 6 years after occupancy, use, or acceptance, or, for gross negligence, more than 1 year after the defect is or should have been discovered and in any event more than 10 years after occupancy. Contract claims have a 6-year period under MCL 600.5807(9), though the repose bar may still limit a defect claim.
Related Michigan pages
- Grand Rapids Real Estate Attorney
- Seller disclosure and home purchase disputes
- Grand Rapids Deeds and Title Defects Lawyer
- Grand Rapids Foreclosure Defense Lawyer
- Breach of contract
- Fraud and misrepresentation
I handle construction lien and builder disputes for Michigan homeowners. Contact me 24/7 by phone or email. Your Rights, My Fight! Call for a free initial consultation.
Big-Firm Power. Street-Level Grit.
Law Offices of Mitchell S. Bisson, 2828 Kraft Ave SE, Suite 295, Grand Rapids, MI 49512, serving Kent County and West Michigan.
This page provides general information about Michigan law and is not legal advice. Reading it does not create an attorney-client relationship. Laws change and every case turns on its own facts. Consult a licensed attorney about your specific situation.