Prompt payment laws, construction liens, and holdbacks: what homeowners must know

Unpaid sub-trades can legally place a lien on your house even if you already paid your general contractor in full. Here is how lien holdbacks and payment laws protect you.

How a construction lien works against a homeowner#

Construction Lien Acts give tradespeople, labourers, and material suppliers the legal right to register a claim of lien against your property title if they are not paid. Even if you paid your general contractor, if they fail to pay a sub-trade, that trade can lien your home.

Contractor milestone verification and lien holdback tracking — Historical cost variance and dispute frequency across residential contracting frameworks.

The 10% statutory holdback: Your legal shield#

By law, property owners are required to withhold 10% of the value of each progress payment as a "statutory holdback" for 45 to 60 days following substantial completion to verify all subcontractor accounts are settled.

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