Massachusetts Lien Law: Types, Priority, and Foreclosure

Massachusetts lien law gives creditors several ways to secure unpaid debts against a debtor’s property, and each type of lien follows its own rules for creation, priority, enforcement, and release. The main categories you will run into are mechanic’s liens filed by unpaid contractors, property tax liens imposed automatically by municipalities, federal tax liens filed by the IRS, judgment liens obtained after a lawsuit, and Medicaid estate recovery liens tied to long-term care. Deadlines are strict, and Massachusetts courts have repeatedly held that a lien created by statute lives or dies on compliance with that statute.¹

Mechanic’s Liens Under Chapter 254

Mechanic’s liens protect contractors, subcontractors, and material suppliers who improve real property and don’t get paid. The rules sit in Chapter 254 of the General Laws, and the deadlines cascade: each step opens a shorter window for the next.

Notice of Contract

The process starts by recording a Notice of Contract at the registry of deeds for the county where the property sits. Filing can happen any time after the written contract is signed, but the outer deadline is the earliest of three events: 60 days after a notice of substantial completion is recorded, 90 days after a notice of termination is recorded, or 90 days after the claimant last provided labor or materials on the project.² Miss the applicable date and there is no lien, no matter how much is owed.

The notice of substantial completion is a separate document that the owner and contractor sign and record once the work is far enough along for the property to be used for its intended purpose.³ Once it is recorded, everyone else on the project is on a tighter clock.

Statement of Account

After the Notice of Contract goes on record, the claimant must file a Statement of Account in the same registry showing the amount owed with credits, a property description, and the owner’s name. The deadline is the earliest of 90 days after a notice of substantial completion is recorded, 120 days after a notice of termination is recorded, or 120 days after the last day labor or materials were furnished.⁴ No timely Statement of Account, no lien.

Suit to Enforce

Recording is not enough. The lienholder must file a lawsuit to enforce the lien within 90 days after recording the Statement of Account, or the lien dissolves by operation of law. Minor errors get some grace: an inaccurate property description does not void the lien if the property can still be identified, and an inaccurate amount does not void it unless the claimant knowingly overstated what was owed.⁵ In Mullen Lumber Co., Inc. v. Lore, the Appeals Court dissolved a lien because the enforcement action was not filed within the statutory period after the statement of account, reinforcing that one missed date is fatal.⁶

Property Tax Liens

Unpaid municipal property taxes create a lien automatically. No filing is required by the city or town. Under Chapter 60, taxes assessed on land become a lien as of January 1 of the assessment year. The lien runs for three years and six months from the end of the fiscal year in which the taxes were assessed, provided the property changes hands and the transfer is recorded. If no recorded transfer occurs, the lien continues indefinitely.⁷

If taxes go unpaid for 14 days after demand, the municipality can sell or take the property, as long as the lien has not terminated. Owners facing a tax taking can redeem by paying the full tax title account plus 8% interest on the original amount from the date of sale, along with any added charges. Installment payments are allowed.⁸ Property tax liens generally outrank most other claims on the property.

Federal Tax Liens

When a taxpayer owes federal taxes and fails to pay after demand, the IRS can file a Notice of Federal Tax Lien that attaches to all of the taxpayer’s property and rights to property. The lien exists the moment taxes are assessed, but it does not affect third parties such as buyers or mortgage lenders until the IRS files public notice. For real property in Massachusetts, that notice is filed at the registry of deeds in the county where the property sits.⁹

The IRS generally has 10 years from the date a tax is assessed to collect. That Collection Statute Expiration Date can be paused or extended when the taxpayer files bankruptcy, requests an installment agreement, submits an offer in compromise, or requests a collection due process hearing.¹⁰

Taxpayers can ask the IRS to withdraw the public Notice of Federal Tax Lien in two common situations: the lien has been released because the tax was paid in full and the taxpayer has been filing-compliant for the past three years, or the taxpayer has entered a direct debit installment agreement covering a balance of $25,000 or less and made at least three consecutive payments.¹¹ Withdrawal removes the public notice but does not eliminate the obligation to pay.

Judgment Liens

A creditor who wins a lawsuit can reach the debtor’s real property by taking an execution from the court and recording it at the registry of deeds in the county where the debtor owns property. Recording creates a lien that stays until the judgment is satisfied. If the creditor previously obtained and recorded a pre-judgment attachment on the same property, the execution must be recorded within 30 days of issuance to preserve the attachment’s original priority.

Judgment liens arise from the court system rather than a specific transaction or government assessment, and they generally sit behind tax liens and previously recorded mortgages in the priority order.

Medicaid Estate Recovery Liens

Massachusetts can place a lien on a Medicaid enrollee’s home during their lifetime if the person is permanently institutionalized. The state is also required to seek recovery from the estates of deceased Medicaid recipients age 55 and older for nursing facility services, home and community-based services, and related hospital and prescription drug costs.¹²

Federal law carves out important exceptions. The state cannot place a lifetime lien on the home if a spouse, a child under 21, or a blind or disabled child of any age lives there. If the enrollee is discharged and returns home, the lien must be removed. After death, recovery cannot proceed if a surviving spouse, a child under 21, or a blind or disabled child exists. States must also have hardship waiver procedures for cases where recovery would cause undue hardship.¹²

The Homestead Exemption

Massachusetts homeowners get a layer of protection against certain liens through the homestead. Every owner-occupied primary residence receives an automatic exemption of $125,000 in equity without any filing. Recording a Declaration of Homestead at the registry of deeds increases that protection to $1,000,000 per residence, per family. If two owners both qualify as elderly or disabled, the aggregate protection can reach $2,000,000.¹³

The homestead protects against attachment, seizure, and execution on judgments up to the exemption amount. It does not protect against everything. Federal, state, and local tax liens cut through it entirely, as do existing mortgages. Court-ordered support payments for a spouse or minor children are exempt from homestead protection, along with judgments based on fraud, any lien recorded before the homestead was created, and Medicaid liens imposed by the Department of Transitional Assistance.¹³ For a judgment creditor, this can mean that even a valid lien produces nothing if the debtor’s equity falls within the exemption.

Lien Priority

When more than one creditor has a lien on the same property, priority determines who gets paid first from a sale. The general rule is “first in time, first in right,” with seniority going to the lien recorded earliest at the registry. Statutory exceptions reshape that order.

Property tax liens under Chapter 60 attach as of January 1 of the assessment year and generally take priority over other claims.⁷ State tax liens under Chapter 62C are valid against most parties once properly noticed, but they do not affect a purchaser or mortgagee who acquired an interest before the notice was filed and had no actual knowledge of the lien.⁹ Federal tax liens follow a similar pattern: the lien exists from assessment but is not valid against certain third parties until the IRS files public notice.

Priority becomes practical during a refinance. Paying off the old first mortgage moves any junior liens up in position, so the new lender typically requires a subordination agreement from any junior lienholder to put the new mortgage back in first place.

Enforcement and Foreclosure

How a lien gets enforced depends on the type. Mechanic’s lienholders must file suit within 90 days of recording the Statement of Account, or the lien dissolves.⁵ Tax lien enforcement runs through the tax taking and foreclosure procedures in Chapter 60, with redemption rights available to the owner until a foreclosure petition is filed.

Massachusetts is a non-judicial foreclosure state. Most mortgage foreclosures proceed under a power of sale clause in the mortgage deed without a judge supervising the process. The foreclosing party must publish notice of the sale once per week for three consecutive weeks in a local newspaper, with the first publication at least 21 days before the sale date, and must send notice by registered mail to the owner of record and to any junior interest holders at least 14 days before the sale.¹⁴

The sale itself is a public auction. Proceeds go first to the foreclosing lienholder, then to junior lienholders in order of priority, with any surplus returned to the former owner. Because there is no court oversight, the burden falls entirely on the foreclosing party to comply with every statutory step.

How Bankruptcy Affects Enforcement

Filing for bankruptcy triggers an automatic stay that halts almost all collection activity. Under 11 U.S.C. § 362, a bankruptcy petition stops any act to create, perfect, or enforce a lien against the debtor’s property, and it bars enforcement of pre-petition judgments and the continuation of lawsuits against the debtor.¹⁵

A pending foreclosure or mechanic’s lien enforcement action must stop the moment the case is filed. The stay applies without notice being served on the creditor, and violating it risks sanctions. The stay lasts until the case is closed, dismissed, or the debtor gets a discharge, though a creditor can ask the court for relief in situations such as the debtor having no equity in the property and the property not being needed for reorganization.

Bankruptcy also suspends the IRS’s 10-year collection period for the duration of the case and extends it by an additional six months after the bankruptcy concludes.¹⁰ The stay does not eliminate the underlying lien. It pauses enforcement, and the lien typically survives the bankruptcy unless the court orders otherwise.

Discharging a Lien

Once the underlying debt is paid or resolved, the lien has to be formally removed from the property records. The lienholder records a discharge or release at the registry of deeds. For mortgages, the lender issues a document titled “Discharge of Mortgage” or “Satisfaction of Mortgage,” and it must be the original; copies and faxes are not accepted for recording. Recording fees for a discharge run roughly $105 to $106 depending on whether the land is registered.¹⁶

Clear the discharge quickly. An unreleased lien clouds title and can block a sale or refinance. If a lender fails to issue a discharge after payoff, the obsolete mortgage statute at Chapter 260, Section 33 can effectively neutralize old mortgages that should have been discharged.¹⁷

Defending Against a Lien

Owners facing a lien have real options. The strongest defense against a mechanic’s lien is procedural: Massachusetts courts have consistently held that a mechanic’s lien “is a creature of the statute, and can be enforced only by strict compliance with the statute.”¹ An owner can defeat the lien by showing that the Notice of Contract was late, the Statement of Account was recorded outside its window, or suit was not filed within 90 days of that recording.

The underlying debt is also fair game. If work was defective, incomplete, or not performed according to the contract, the amount claimed may be reduced or eliminated. Comparing the contract terms against what was actually delivered is where most of these disputes turn.

Statutes of limitations provide another line of defense. A mechanic’s lien dissolves automatically if the claimant does not file suit within 90 days of recording the Statement of Account, and tax lien enforcement is bounded by the lien’s statutory duration.⁵ For federal tax liens, the IRS loses collection authority once the 10-year statute expires, absent a suspension or extension.¹⁰

1
Justia. Hammill-McCormick Associates, Inc. vs. New England Telephone and Telegraph Company
2
General Court of Massachusetts. Massachusetts Code Chapter 254 Section 2 – Written Contract; Notice; Time for Filing; Form
3
General Court of Massachusetts. Massachusetts General Laws Chapter 254 Section 2A
4
Justia. Massachusetts Code Chapter 254 Section 8 – Statement of Amount Due; Time for Filing; Dissolution of Lien
5
General Court of Massachusetts. Massachusetts General Laws Chapter 254 Section 11
6
Massachusetts Cases Archive. Mullen Lumber Co., Inc. vs. Lore
7
General Court of Massachusetts. Massachusetts General Laws Chapter 60 Section 37
8
General Court of Massachusetts. Massachusetts General Laws Chapter 60 Section 62
9
Mass.gov. 830 CMR 62C.50.1 – Lien on Property
10
Internal Revenue Service. Time IRS Can Collect Tax
11
Internal Revenue Service. Understanding a Federal Tax Lien
12
Medicaid.gov. Estate Recovery
13
Secretary of the Commonwealth of Massachusetts. Questions and Answers – The Homestead Act
14
General Court of Massachusetts. Massachusetts General Laws Chapter 244 Section 14
15
Office of the Law Revision Counsel. 11 USC 362 – Automatic Stay
16
Secretary of the Commonwealth of Massachusetts. Registry of Deeds Fee Schedule
17
Norfolk County Registry of Deeds. Mortgage Discharge