This might be of interest to some. It is from the Denver news. A good reason to always get Title insurance. I know most people know to pay their builder and make sure he pays the subs, but you must also make sure that the sub pays all of the bills associated with your house. Here is a link that might be useful: Lawsuits against new homeowners

All the DR Horton homes I bought and sold (as my daughter who sold about 20 or so over the last 18 months), have been closed by a title company with a "Lien Waiver/Final Affidavit and Agreement" given to the buyes. It will be interesting to see what happens, since DR Horton has really been in a slump.

More boring terms/definitions, etc.: POTENTIAL TAX CONSEQUENCES OF A FORECLOSURE FOR THE BORROWER: When a lender forecloses on a home, the IRS treats it as a sale. If the borrower is not personally liable for the debt, such as would be the case for a nonrecourse loan, then the selling price is equal to the price of the cancelled debt. If the borrower is liable for the debt, then the sale price is equal to the canceled debt up to the fair market value (FMV) of the home. If the canceled debt is greater than the FMV, then the difference between the debt and the FMV is treated as ordinary income, for which the lender is required to send a Form 1099-C, Cancellation of Debt (COD), listing the amount of ordinary income. Any unpaid liabilities on the property, such as property taxes, will reduce the FMV of the home and increase the COD. However, if the liabilities are paid by the borrower, then this will increase the FMV and decrease the COD. The lender will also send a Form 1099-A, Acquisition or Abandonment of Secured Property, that will allow the borrower to determine the capital gain or loss from the foreclosure. Taxes must be paid on the capital gain in addition to any ordinary income from the canceled debt that exceeds the FMV of the home in a recourse loan. For a nonrecourse loan, any income is treated as a capital gain equal to the canceled debt minus the adjusted basis of the propertythere is no COD income. However, a capital loss from a foreclosure cannot be deducted. With the recent decline of home prices, many homes are worth less than the amount of money owed on the property, especially for borrowers who took advantage of lax lending standards, and bought with no money down or used inflated home appraisals. Consequently, many homeowners whose homes were foreclosed by the lender may owe a significant amount of taxes.The IRS treats all forgiven debt as ordinary income, even though in the case of foreclosure, the homeowner doesnÂt get to keep the home. If the taxes are not paid for the year the debt was canceled, then the IRS adds penalties and interest to the total tax bill, which can often be tens of thousands of dollars. However, the tax is not owed: ...if the debt is discharged in bankruptcy; ...the debtor is insolvent, with debts greater than assets; ...the fair market value of the home is greater than the canceled debt; ...or the loan was from a friend or relative and the canceled debt is treated as a gift. Any debt canceled by a commercial lender is not considered a gift by the IRS. ...Because the lender has some discretion in valuing a home, it can sometimes be successfully argued that the fair market value of the home was greater than the debt, in which case, no tax on COD is due. TITLE INSURANCE: An insurance policy used to ensure ownership where abstracts are not used. The borrower pays for the lender's policy. They are wise to also cough up another $50, or so, and purchase one for themselves; but the lender does not require it. CLOUD: Doubt, a gap in the chain of ownership. Or, it could be a lien, unpaid taxes, or something else that affects ownership. ENCUMBRANCE: Mortgage, lien, tax, or any restriction on the use of the land...could also be an easement. ABSTRACT OF JUDGMENT: An abstract is a summary (see title abstract). An abstract of judgment is a summary of a judgment. A judgment is the end result of a lawsuit. It shows who won the lawsuit, who lost, how much is owed, what Court made the decisions, the date of the judgment, and the attorney for the winner of the lawsuit. Once the abstract of judgment is recorded (filed with the county clerk or county recorder), it creates a general lien on the judgment debtor's property, including the real estate. An abstract of judgment will be discovered by a title company whenever a landowner tries to sell the land. Most title companies will demand that it be paid off as a condition of insuring the resale. /tricia

Start by going to the local court house where the lien was filed with your lien release. See if that works. For the most part a mechanics lien sits dormant until you sell the house. Also, these liens have a shelf life. That is to say they may only be good for 6 months so the guy would have to keep refiling the lien.