Massachusetts
Construction Lending State Compliance Library
State statute reference
Last updated January 9, 2025
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Massachusetts Construction Lien Law
Lien Waiver Overview
Massachusetts has strict laws regarding mechanics lien law and the processes that must be followed to establish first lien priority and maintain it during construction. Following the state laws will help ensure that a construction lender maintains control over the project and reduces risk of potential mechanics liens.
Mechanics liens in Massachusetts are governed by the Massachusetts lien law statutes, Mass. Ann. Laws ch. 254, § 1 et seq. A party filing a mechanics lien must strictly comply with the lien statutes in order to perfect its lien. See E. Coast Steel Erectors v. Ciolfi, 417 Mass. 602, 632 N.E.2d 397 (1994).
The Massachusetts construction lien statute provides for four types of liens. (See Mass. Ann. Laws ch. 254, § 1, 2, 4)
- Liens for “personal labor” are performed in the erection, alteration, repair, or removal of a building or structure.
- General contractor liens arising out of a written contract for the construction, or alteration of improvements on the land.
- Liens in favor of a party who has performed or furnished labor or material pursuant to a contract with a contractor, i.e. a subcontractor or materialman.
- Liens in favor of “design professionals”, including architects, landscape architects, professional engineers, surveyors, and licensed site professionals – holding written contracts with the owner relating to the proposed or actual erection, alteration, repair, or removal of a building structure or other improvement to real property.
Massachusetts mechanics liens statutes require that there be a written contract between the parties (with an exception for some laborers). See Mass. Ann. Laws ch. 254, § 1. Additionally, in Massachusetts all notices or other instruments required or permitted to be filed or recorded by or under the mechanics lien statutes in the registry of deeds or in the land registration district of the land court must be executed by a party authorized to record or file the notice or instrument. See Mass. Ann. Laws ch. 254, § 30
Lien Waivers
Lien Waiver Summary
A waiver and release of lien is void and unenforceable in Massachusetts unless given in exchange for payment. Partial lien waivers and subordinations given by persons under direct contract with the owner who have filed or recorded Notice of Contract are permitted in certain instances (e.g., subordination to a lender) and should be in a form substantially similar to that prescribed by statute. See Mass. Ann. Laws ch. 254, § 32. Unfortunately, there’s no clear-cut definition of “substantially similar” within the statute or directly in related case law. This generally means that the determination of what constitutes “substantially similar” is made on a case-by-case basis, considering the specific facts and circumstances of each situation. It is highly recommended that you favor strict compliance with the law and avoid altering the “Partial Waiver and Subordination of Lien” form.
The “Partial Waiver and Subordination of Lien” form is a single lien waiver that can be used when:
- Given in exchange for payment, and
- The form is substantially similar to the one prescribed by the statute, and
- Given by a party under a direct contract with the owner, and
- The party providing the waiver has filed and recorded a “Notice of Contract”
The “Partial Waiver and Subordination of Lien” form is unique to other statutory lien waivers in other states as it contains information related to the contract with whom the party has engaged. The form references the original contract amount, change orders, retainage, and disputed claims. It’s important that this form is completed accurately to obtain the two primary benefits of its use. These include:
- Waiver of the party’s lien rights
- Subordination of the party’s lien rights to the lender/mortgagee
Statutory Form
Required*
Notary
Not Required
Electronic Signature
Acceptable
*Massachusetts has a single lien waiver called the “Partial Waiver and Subordination of Lien” that has specific requirements when used. See Mass. Ann. Laws ch. 254, § 32.
Are title companies required by law to manage construction loan disbursements?
No, but title companies are insurance companies that may require – in exchange for insurance coverage – some level of control over how loan proceeds are disbursed.
Can a mechanics lien have priority over a pre-existing mortgage in Massachusetts?
Generally speaking, it is possible that a mechanics lien can have priority over a construction loan if the state’s laws are not strictly followed.
The Massachusetts construction lien statute provides for four types of liens. (See Mass. Ann. Laws ch. 254, § 1, 2, 4) Each lien statutes should be reviewed when considering potential risk involving mortgage lien priority.
Prior to the recording of a construction loan, a lender should make sure that a Notice of Contract was not recorded prior to the mortgage loan as well as obtaining evidence that no work has begun at the property. This is a critical step to establishing and maintaining a first lien priority. Mechanics liens priority in Massachusetts can be established based on the date that the Notice of Contract is filed (or work actually begun at the property). In the event that the Notice of Contract is recorded prior to the recording of a construction loan or actual work began prior to the recording of the mortgage loan, it may allow the party to have priority over the recorded mortgage.
In Massachusetts, a Notice of Contract is not only used for a contracted party to establish their lien rights but it also enables the use of the state’s single statutory lien waiver called “Partial Waiver and Subordination of Lien”. In general, it is against public policy, void, and unenforceable to prevent a party from filing of a Notice of Contract, taking steps to prevent the enforcement of a lien, or to subordinate such rights to other parties, except the use of “partial waivers and subordination of liens” given by persons who have recorded a Notice of Contract. (See Mass. Ann. Laws ch. 254, § 32(4))
In Massachusetts you will find different requirements for each of the lien types below:
Laborers. A mortgage first recorded or duly registered will have priority over a lien for labor under Mass. Ann. Laws ch. 254, § 1 unless the work or labor performed is part of the improvement itself and began prior to the recording of the mortgage. Mass. Ann. Laws ch. 254, § 7(a).
Direct Contractors. A mortgage first recorded or duly registered, including a mortgage securing future advances, will have priority over a lien of a contractor or other person in direct contract with an owner to the extent of amounts actually advanced or unconditionally committed prior to the filing or recording of the Notice of Contract, and after the filing or recording of the Notice of Contract but within 25 days after the last day of the period stated in an executed partial waiver, except for the amount of retainage stated in the lien waiver. See Mass. Ann. Laws ch. 254, § 7(b). See also Mass. Ann. Laws ch. 254, § 32.
Direct Contract With Contractor. A mortgage first recorded or duly registered, including a mortgage securing future advances, will have priority over the lien of a subcontractor, laborer, or material person under direct contract with a contractor to the extent of the amount actually advanced or unconditionally committed prior to the filing or recording in the registry of deeds of the party’s Notice of Contract. See Mass. Ann. Laws ch. 254, § 7(c).
Design professionals. A mortgage first recorded or duly registered will have priority over the lien of a design professional or subcontractor of a design professional prior to the filing or recording of the Notice of Contract if and to the extent that such lien relates to professional services performed before such mortgage was registered or recorded. If the lien relates to professional services performed after the mortgage was registered or recorded, the lien will have priority over the mortgage except to the extent of the amount actually advanced or unconditionally committed prior to the filing or recording of the Notice of Contract. See Mass. Ann. Laws ch. 254, § 7(d).
Notices
Notice of Commencement (or similar like event)
A Notice of Commencement is not a concept for the state of Massachusetts, however, a Notice of Contract is used to establish lien rights and priority as well as it allows use of the State’s “Partial Waiver and Subordination of Lien” and the the use of the State’s Notice of Substantial Completion.
The Notice of Contract is a critical first step for construction lenders in adhering to the complexities of Massachusetts construction lien law and protecting the first lien priority. The Notice of Contract can be recorded prior to the construction mortgage, after the construction mortgage is recorded, and up-to 90-120 days (depending on the event). The opportunity to file the Notice of Contract can be problematic and should be coordinated to ensure that the construction mortgage has priority over potential mechanics liens, allow for the use of the state’s statutory lien waiver, and allow for the use of the state’s Notice of Substantial Completion.
Preliminary Lien Notifications
General contractors in Massachusetts are generally not required to send preliminary notice to retain mechanics lien rights. Subcontractors and suppliers not in direct contract with the contractor should provide the contractor with a “Notice of Identification”.
Below is a list of commonly filed notices in Massachusetts that have similar mechanics to a ‘preliminary lien notice’ provided that help identify parties performing work on a project.
Notice of Identification. A person claiming a lien that has no direct contractual relationship with the original contractor should provide the contractor with a Notice of Identification within 30 days of the date it commences work in order to preserve lien rights for the full amount that may become due. Notice should be sent by certified mail return receipt requested. See Mass. Ann. Laws ch. 254, § 4.
Notice of Contract. A contractor, design professional (architect and engineer), or other lien claimant entering into a direct contract with an owner for labor, including construction management and general contractor services, and material or rental equipment, appliances, or tools, is required to file a Notice of Contract in a form substantially similar to the form prescribed by statute. The notice should be filed or recorded in the registry of deeds in the county or registry district where the land lies. The lien attaches on the date the notice is filed or recorded. See Mass. Ann. Laws ch. 254, § 2 and Mass. Ann. Laws ch. 254, § 4 (contractor and subcontractor), and Mass. Ann. Laws ch. 254, § 2C and Mass. Ann. Laws ch. 254, § 2D (design professionals and subcontractors of design professionals). See also Tremont Tower Condo. LLC v. George B.H. Macomber Co., 436 Mass. 677, 767 N.E.2d 20 (2002).
A claimant may file a Notice of Contract at any time after execution of the contract, but in no event may the Notice of Contract be filed later than the earliest of (1) 60 days after filing or recording of the notice of substantial completion or 90 days after filing or recording of the notice of termination, if applicable, or (2) 90 days after work was last performed or materials last furnished. See Mass. Ann. Laws ch. 254, § 2.
The recording of the Notice of Contract establishes the priority of the mechanics lien. See Tremont Tower Condo. LLC v. George B.H. Macomber Co., 436 Mass. 677, 767 N.E.2d 20 (2002).
Notice of Contract for Design Professional. A design professional entering into a written contract with the owner of any interest in real property or with any person acting for, on behalf of, or with the consent of such owner, for the provision of professional services relating to the proposed or actual erection, alteration, repair or removal of a building, structure, or other improvement to real property, must have a lien upon such real property, land, building, structure or improvement owned by the party with whom, on behalf of whom or with the consent of whom the contract was entered into, as appears of record on the date when notice of said contract is filed or recorded in the registry of deeds for the county or district where such land lies, to secure the payment of all amounts due or to become due to the design professional under such contract. Said notice must be in substantially the following form:
Notice is hereby given that by virtue of a written contract dated , between , owner, and, design professional, said design professional is to furnish or has furnished professional services relating to the proposed or actual erection, alteration, repair or removal of a building, structure or other improvement on a lot of land or other interest in real property described as follows:
Such design professional may file or record the Notice of Contract at any time after the execution of the written contract whether or not the professional services under such written contract have been commenced or completed, and whether or not the erection, alteration, repair or removal of the building, structure, or other improvement to which such professional services relate has been, or is ever, commenced or completed, but not later than the earlier of: (i) 60 days after filing or recording of the notice of substantial completion under section 2A; or (ii) 90 days after such design professional or any person by, through or under him, last performed professional services.
Notice of Completion
Upon or after substantial completion of any contract (Notice of Contract) subject to the provisions of state laws found in section 2, the owner and contractor must execute and file or record in the appropriate registry of deeds a Notice of Substantial Completion in substantially the form provided by the State. Under the statute, “Substantial Completion” means that work under the written contract is sufficiently complete so that it can be occupied or utilized for its intended use.
Benefits to following the state law regarding a Notice of Substantial Completion, amongst other benefits shortens the deadline for parties to file a mechanics lien.
When Must it be Filed
When work under the written contract is sufficiently complete so that it can be occupied or utilized for its intended use.
Other Notices
Statement of Account. A mechanics lien of a contractor, subcontractor, or person claiming by, through or under them, will be dissolved unless a statement of account is filed in the registry of deeds setting forth a true account of the amount due or to become due, with all credits, a brief description of the property, and the names of the owners set forth in the notice of contract. The statement of claim should be filed not later than the earliest of:
- 90 days after the filing of the Notice of Substantial Completion or 120 days after the filing of the Notice of Termination, if applicable -or-
- 120 days after the last day a person in direct contract with the owner and entitled to enforce a lien under Mass. Ann. Laws ch. 254, § 2 performed or furnished labor, material or both, or furnished rental equipment, appliances, or tools.
Design professionals and their subcontractors should file a statement of account within 30 days after the last day that a Notice of Contract may be filed or recorded to avoid losing lien rights. See Mass. Ann. Laws ch. 254, § 8. A lien for labor under Mass. Ann. Laws ch. 254, § 1 will be dissolved unless a statement of account is filed or recorded within 90 days. The statement should provide the name of the owner of record at the time the work was performed or at the time of filing the statement. See Mass. Ann. Laws ch. 254, § 8.
Notice of Substantial Completion. Upon or after substantial completion of any contract subject to the provisions of section two, the owner and contractor must execute and file or record in the appropriate registry of deeds a Notice of Substantial Completion in substantially the following form. Under the statute, “Substantial completion” means that work under the written contract is sufficiently complete so that it can be occupied or utilized for its intended use.
Notice of Termination. If a contract is terminated before the filing of a Notice of Substantial Completion, the owner must execute and file or record in the appropriate registry of deeds a Notice of Termination in substantially the following form.
Title
Massachusetts uses ALTA title commitments that allow for the Construction Loan Update Endorsement, which is used when the lender requests endorsements as additional disbursements are made. It gives coverage up to the new outstanding mortgage balance and shows whether any other instruments have been filed and recorded since the last title update. The endorsement also ensures the priority of the insured mortgage over instruments that are not specifically listed in the endorsement. Since the title company has a stake in the disbursements, you may find that they exercise some due diligence relating to construction draws.
Contractor Licensing
In Massachusetts, a general contractor, also referred to as a construction supervisor, must obtain a construction supervisor license (CSL) from the state Board of Building Regulations and Standards. See Mass. Ann. Laws ch. 143, § 94(i) and Rule 110.R5.1 et seq., at 780 Mass. Code Regs. 110.00.
Check a Home Improvement Contractor Registration:
https://www.mass.gov/how-to/check-a-home-improvement-contractor-registration
Check a Construction Supervisor License:
https://www.mass.gov/how-to/check-a-construction-supervisor-license
Contractor License Look-up:
https://massachusetts.uhire.com/
Bond
No surety bond is required for registration as a Massachusetts home improvement contractor. The state regulates out-of-state contractors through the Department of Revenue to ensure payment of sales and use taxes on project materials.
Massachusetts Construction Lending Documents Kit
Download the Massachusetts documents kit by filling out the form. The package includes the following:
Disclaimer: These forms are provided for informational purposes only and are not intended to be legal advice or establish an attorney-client relationship. They are posted ‘as is’ and we do not warrant that they are the most current version. Users of these forms should consult their legal counsel before using for their particular transaction.
- Massachusetts Notice of Contract
- Massachusetts Notice of Substantial Completion
- Massachusetts Notice of Termination
- Massachusetts Partial Waiver and Subordination of Lien
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