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Builder’s Lien
A builder’s lien is a legal claim registered against a property’s land title by a contractor, subcontractor, or material supplier who has not been paid for work or materials. It secures the debt against the home and can block a sale or refinance until the claim is resolved.
Builder’s Lien Quick Facts
- A claim on the title by the unpaid construction trades
- Secures money owed for work or materials
- Can block a sale or refinance until cleared
- Rules and deadlines vary by province
- Take priority over standard or collateral charges
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What Is a Builder’s Lien
A builder’s lien, also called a construction lien, allows contractors, subcontractors, and suppliers to register a claim against a property when they are not paid for work performed or materials delivered. The lien attaches to the title, so it follows the property until the debt is settled or the claim expires.
Construction is a provincial matter, so the deadlines and rules differ across the country. In British Columbia, a claim is filed through the Land Title and Survey Authority, and comparable registries handle liens in other provinces.
Why a Builder’s Lien Matters for Mortgages
A lien on title is a direct problem for financing. Lenders will not advance a mortgage, and you cannot cleanly sell or refinance, while an unresolved builder’s lien sits on the property, since it competes with the lender’s own claim. It most often surprises buyers of new builds and owners who have renovated.
The deadlines are tight and province-specific. British Columbia and Alberta generally allow 45 days to register after work ends, Ontario allows 60 days under the Construction Act with a required holdback, and Quebec treats it as a legal hypothec registered within 30 days. Clearing a lien usually means paying the debt, posting security, or paying the amount into court until the matter is settled.
How Builder’s Liens Work Across Canada
The core idea is national, but the details are provincial.
British Columbia and Alberta. Claimants generally have 45 days from the last day of work or delivery to register, with a further window to start a court action. In BC, claims run through the Land Title and Survey Authority.
Ontario. The Construction Act requires registration within 60 days of substantial completion, and homeowners must hold back 10% of the total payment to protect against unpaid subcontractors who may place a lien if the contractor fails to pay them.
Quebec. Known as a legal hypothec, it must be registered within 30 days of the work ending, with a further six months to file a prior notice or a hypothecary action.
For example, you buy a newly built home and a drywall subcontractor was never paid by the builder. The subcontractor registers a builder’s lien on your title. Your lender freezes the advance until the lien is discharged, so the builder must pay the debt or post security before your mortgage can close.
Common Mistakes and Misunderstandings About Builder’s Liens
- Assuming a builder’s lien only affects the contractor
- Thinking the rules are the same in every province
- Missing the tight registration deadlines
- Overlooking the holdback that protects owners
- Confusing a builder’s lien with a mortgage charge
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Frequently Asked Questions (FAQ) About Builder’s Liens
What is a builder’s lien?
It is a legal claim that an unpaid contractor, subcontractor, or supplier registers against a property’s land title to secure money owed for construction work or materials.
How does a builder’s lien affect my mortgage?
A lien on title usually stops a lender from advancing funds and blocks a sale or refinance until it is discharged, because it competes with the lender’s claim.
What is the difference between a builder’s lien and a legal hypothec?
Both a builder’s lien and a legal hypothec serve the same purpose. Common-law provinces call it a builder’s or construction lien, while Quebec calls it a legal hypothec, with its own registration rules.
How long does a builder’s lien last in Canada?
How long a builder’s lien lasts depends on the province. Registration deadlines range from 30 to 60 days after work ends, and the claim expires if the claimant does not initiate a court action within that period.
How do I remove a builder’s lien?
Usually, by paying the debt, negotiating a release, posting security, or paying the claimed amount into court, which shifts the claim off the title.