Oregon lien laws recognize three main categories of liens that can attach to real property: construction liens filed by unpaid contractors and suppliers, judgment liens created by court awards, and tax liens imposed by state or federal authorities. Each has its own filing deadlines, priority rules, and release procedures. The state’s homestead exemption shields up to $40,000 of equity in a primary residence for a single debtor, or $50,000 when two or more household members are debtors on the same property, but that protection has real limits depending on the type of lien involved.1OregonLaws. Oregon Revised Statutes 18.395 – Homestead Exemption
The Three Main Types of Liens
Construction Liens
A construction lien (sometimes called a mechanics lien) lets contractors, subcontractors, material suppliers, equipment rental companies, and design professionals secure payment for work that improves real property. The lien attaches directly to the property, so an unpaid party has a legal claim even without a direct contract with the owner. That last point catches many owners off guard: a subcontractor or supplier the owner never met can file against the owner’s land.
To be enforceable, the work or materials must be permanently incorporated into the property. Temporary structures and purely advisory services generally do not qualify.
Judgment Liens
When a court awards money damages, the winning party can create a lien on the debtor’s real property by filing a certified copy of the judgment with the county clerk. Once recorded, the lien attaches to any real property the debtor owns in that county. For justice and municipal court judgments, the lien lasts 10 years and can be renewed once for an additional 10 years.2Oregon State Legislature. Oregon Revised Statutes 18.194 – Expiration and Extension of Judgment Remedies for Justice and Municipal Court Judgments
A judgment lien does not let the creditor immediately seize and sell the home. The creditor usually needs to pursue foreclosure or obtain a writ of execution, and Oregon’s homestead exemption applies automatically without the debtor filing a claim. If a home’s equity exceeds the exemption amount, though, a judgment creditor may still force a sale.
Tax Liens
Government tax liens arise when a property owner falls behind on income, property, or business taxes. Oregon’s Department of Revenue creates a state tax lien by filing a warrant with the county clerk, which attaches to all real and personal property the taxpayer owns.3Oregon State Legislature. Oregon Revised Statutes 321.570 – Warrant for Collection of Delinquent Taxes Federal tax liens follow IRS procedures and must be recorded in the county where the property sits to be enforceable against other creditors. Tax liens from both governments generally take priority over most other claims, so tax authorities get paid before private creditors when a property is sold. Taxpayers who disagree with the assessment can challenge the lien through the agency’s dispute process or negotiate a payment plan; some federal tax liens can be withdrawn under the IRS Fresh Start program for taxpayers who enter a direct debit installment agreement.4Internal Revenue Service. Understanding a Federal Tax Lien
Construction Lien Deadlines
The construction lien timeline is where valid claims most often die. Miss any of these deadlines and the lien weakens or expires.
Information Notice to Owner
On residential projects, or whenever the contract price exceeds $2,000, the contractor must deliver an Information Notice to Owner before or at the start of work. It has to go by personal delivery, registered mail, certified mail, or first-class mail with a certificate of mailing.5Oregon Construction Contractors Board. Information Notice to Owner About Construction Liens
Notice of Right to Lien
Subcontractors, material suppliers, and equipment rental companies without a direct contract with the owner have to send a Notice of Right to Lien. The timing is narrower than most people think: the notice protects only work or materials provided after a date that is eight business days before the notice is delivered or mailed. Saturdays, Sundays, and legal holidays do not count.6Oregon State Legislature. Oregon Revised Statutes Chapter 87 – Construction Liens A subcontractor who waits weeks to send the notice forfeits lien rights on the earlier work. Delivery must be personal or by registered or certified mail.7Oregon Landscape Contractors Board. Lien Information
Recording the Lien: 75 Days
The lien claim must be recorded with the county where the property sits within 75 days after the claimant last provided labor, equipment, or materials, or 75 days after construction is complete, whichever comes first.8OregonLaws. Oregon Revised Statutes 87.035 – Perfecting Lien The claim must include the amount owed after credits, the owner’s name, the name of the person who hired the claimant, and a property description sufficient for identification, all verified under oath. Errors in the property description or a materially overstated amount can make the lien vulnerable to challenge.
Notice After Filing: 20 Days
Within 20 days of recording, the claimant must mail written notice of the lien claim to both the owner and any mortgagee, attaching a copy of the claim. Skipping this step does not automatically void the lien, but it forfeits the right to recover costs, disbursements, and attorney fees in any enforcement action.9Oregon State Legislature. Oregon Revised Statutes 87.039 – Notice of Filing Claim of Lien
Foreclosure Suit: 120 Days
If the lien remains unpaid, the claimant must file a foreclosure lawsuit within 120 days of recording. Let that deadline pass and the lien expires no matter how much is owed.10OregonLaws. Oregon Revised Statutes 87.055 – Duration of Lien There are no extensions unless extended payment terms were stated in the original lien claim. Many valid claims die here, when a claimant files the lien, assumes the threat alone will force payment, and then runs out of time.
Who Can File a Construction Lien
Oregon grants lien rights broadly to contractors, subcontractors, material suppliers, equipment rental companies, architects, and engineers whose work or materials were permanently incorporated into real property. But two gatekeepers regularly disqualify claimants who would otherwise have valid claims.
The first is licensing. A contractor must hold a valid license from Oregon’s Construction Contractors Board at the time the work was performed. An unlicensed contractor cannot perfect a construction lien, file a CCB complaint, or bring a court claim for payment on work that requires a license.11OregonLaws. Oregon Revised Statutes 701.131 – License Required to Perfect Lien If a license lapsed mid-project, lien rights for work done during the gap are gone.
The second applies to residential projects. Oregon requires original contractors on residential work to have a written contract with the owner. Without one, the contractor may not place a lien against the owner’s property.12Oregon Construction Contractors Board. Information Notice to Owner About Construction Liens
Priority When Multiple Liens Compete
Oregon generally follows first in time, first in right: an earlier-recorded lien outranks a later one. Construction liens break that pattern in important ways.
A construction lien filed by the original contractor or someone who contracted directly with the owner is preferred over any mortgage or encumbrance that attached after construction began, or that was unrecorded when work started. For subcontractors and other lien claimants, the lien attaches to the improvement itself and is preferred over all prior liens and mortgages on the land.13OregonLaws. Oregon Revised Statutes 87.025 – Priority of Perfected Liens
Tax liens sit above nearly everything else. Federal and state tax authorities collect before private creditors in almost all situations. Judgment liens rank by recording date, oldest first, subject to the homestead exemption on a debtor’s primary residence.
How to Contest a Lien on Your Property
A property owner who believes a lien is improper has several options.
The most direct is a lien release bond. The owner files a surety bond with the county recording office in an amount equal to at least 150 percent of the lien claim, or $1,000, whichever is greater.14Oregon State Legislature. Oregon Revised Statutes 87.076 – Bond or Deposit of Money; Amount; Demand for Release of Lien; Effect The bond substitutes for the lien, freeing the property while the dispute plays out. A cash deposit works too.
The second is attacking the lien procedurally. If the claimant skipped a required Notice of Right to Lien, missed the 75-day recording deadline, failed to file the foreclosure suit within 120 days, or materially misdescribed the property, the lien may be unenforceable. Courts regularly invalidate liens where these requirements were cut.
The third is challenging the amount. A court can reduce a lien to the correct figure, or throw it out entirely if the overstatement was made in bad faith. A lien filed without any legitimate basis can support a slander of title claim, in which the owner sues for damages caused by the wrongful cloud on title, typically including the cost of removing the lien and losses from impaired ability to sell or refinance.
Releasing a Lien After Payment
Once a construction lien has been paid in full, the lienholder must file a release with the same county recording office where the lien was recorded, within 10 days of receiving full payment.15Oregon Construction Contractors Board. Construction Liens: What You Need to Know A lienholder who refuses to release a satisfied lien can be liable for damages the owner incurs, including costs tied to delayed sales or refinancing. If the lienholder will not cooperate, the owner can petition a court to order removal. Owners who posted a lien release bond can serve a written demand and, if the claimant fails to act, recover actual costs of obtaining the release.14Oregon State Legislature. Oregon Revised Statutes 87.076 – Bond or Deposit of Money; Amount; Demand for Release of Lien; Effect
Lien Waivers Are Not the Same Thing
Waivers come up during ongoing projects and are separate from releases. A conditional lien waiver takes effect only after payment actually clears. An unconditional waiver takes effect immediately upon signing, whether or not the check has cleared. Signing an unconditional waiver eliminates the right to file a lien for the amount covered, even if the payment later bounces, so verify funds first.
What Bankruptcy Does to a Lien
When a property owner files for bankruptcy, the automatic stay immediately halts most lien-related activity. Creditors cannot file new liens, enforce existing ones, or take collection action against the debtor’s property while the stay is in place. One exception matters: government tax liens for property taxes that come due after the bankruptcy petition is filed are not blocked by the stay.16Office of the Law Revision Counsel. 11 U.S. Code 362 – Automatic Stay
Chapter 7 debtors may be able to eliminate a judgment lien on their home through lien avoidance. If the judgment lien eats into equity that would otherwise be protected by the homestead exemption, the debtor can list the property as exempt and file a motion to avoid the lien in whole or in part. This works only for judgment liens, not for consensual liens like mortgages or for most tax liens. Construction liens generally survive bankruptcy unless the underlying debt is discharged and the lien is avoidable under federal bankruptcy rules.