New York Release of Lien Bond
AmeriPro Surety Bonds | 844-589-9732
Please note that as of May 2020: We are currently not accepting any more applicants for the NY mechanic’s lien bond.
Release of Lien Bond
If you are reading this page you may have been told (or for legal counsel, a client of yours may have been told) that a release of lien bond is required.
The New York release of lien bond is alternately known as a release of a mechanic’s lien bond. Both terms mean the same.
The release of lien bond is a type of court surety bond which is sometimes required in cases where litigants are disputing claims on a property.
The statutes which govern a release of lien bond are found under Article 2, 37 of the New York state’s statues.
What is a New York Release of Lien Bond?
When contractors perform work on property, they have the ability to attach a lien against the property for non-payment of the work performed.
The lien can prevent an owner from refinancing, selling, or transferring ownership of the property, without first satisfying the lien.
Having a New York release of lien bond does several things:
- One, it releases any liens on the property for nonpayment of contractor work performed, so the property is not encumbered by the existence of a lien;
- And two, while it release the lien, again, on the property, it attaches the lien to the surety bond. So, the lien is no longer encumbering the property; it is on now “attached” to the surety bond.
- This transfer is allowed because the existence of the surety bond will guarantee payment of the work completed by a contractor.
The Amount for a New York Release of Lien Bond
By New York state law, a release of lien bond must be for an amount that is 110% of the lien claimed.
As an example: a mechanic’s lien of $15,000 would require a release of lien bond of $16,500, which is ($15000*110%)
The additional amount covers any interest, and other costs which may accrue while the case is being litigated.
Obtaining a Release of Lien Bond
You’ll know if if a release of lien bond is required because there will be a court order that mandates that you obtain one.
Our agency will request a copy of the court order, in addition to taking your application.
While we have additional options (beyond what is stated here and which we can discuss with you) for obtaining a release of lien bond, many are backed by full collateral.
Full collateral typically, though not exclusively, takes place in the form of:
- Cash backing the surety bond for the amount required;
- An irrevocable letter of credit from your banking institutions.
For those with exemplary credit and who can demonstrate and who can meet other requirements, sometimes a signature alone is sufficient.
Premium for a New York Release of Lien Bond
The premium paid for the surety bond’s issuance is in addition to the bond amount required.
As a purchaser of the release of lien bond, you should be fully aware that the premium renews on an annual basis for as long as the underlying case is still being heard in court.
The premium amount will be based on the surety bond amount required.
AmeriPro Surety Bonds welcomes the opportunity to work with you to obtain the release of lien bond that you require.
As a surety bonds-only agency, our focus is just that.
We understand — even before speaking with you — that you have a deadline, and that this particular bond need is urgent.
Our agency is efficient, friendly, and we appreciate your consideration of our services.
Please call us today: 844-589-9732