If you are a licensed automotive facility and have repaired a vehicle, chances are that the state in which you are operating has a process for obtaining a mechanic’s lien to ensure you recover your costs. However, if you are not licensed in that state, you cannot file for a mechanic’s lien. The mechanic’s lien process is complex and should only be pursued as a last resort; it is not an easy way to title the vehicle. If you are an authorized entity, check with your state’s Department of Motor Vehicles to find out what steps must be taken to correctly file for a mechanic’s lien.
What is a mechanic’s lien?
In the simplest terms, a mechanic’s lien is a process that licensed automotive facilities can use to recover the costs of an unpaid bill. Typically this happens if a vehicle has been towed, stored, or otherwise left unattended by the registered owner with an unpaid service bill for a specific amount of time.
How to file a mechanic’s lien in Kentucky
In order to be eligible for a mechanic’s lien in Kentucky, a vehicle or vessel must be in the possession of a person engaged in the business of selling, repairing, or furnishing parts for vehicles and the owner of that vehicle owes that person charges for repairs, labor, or supplies for more than 30 days. Once the vehicle or vessel has met this criterion, it may be sold at auction in order to pay for the accrued charges.
Before the sale can proceed, you must make all reasonable attempts to contact the registered owner and any security interests such as lienholders. This information must come from a title search to ensure the proper parties are contacted according to the DMV’s records. This contact must be made through certified mail to notify the owner and lienholder of the proposed sale. This initial notice of sale must be sent at least ten days prior to the proposed sale date. Be sure to keep all certified mail receipts as they will be needed when applying for a title.
In addition to the notice, you must also advertise the sale in the local newspaper once a week for three consecutive weeks. The advertisement must include the year, make, model, VIN, name of the owner(s), name of the lienholder(s), and the name, address, and phone number of your automotive shop.
Once all notification requirements have been completed, you can proceed with the sale. The sale may be made to an outside buyer, or your shop may also bid on the vehicle. In compliance with Kentucky statutes above (KRS.376.270, KRS 376.280, and KRS 424.130), the purchaser of a vehicle sold under a mechanic’s lien must provide the following documents when applying for a vehicle title:
- Affidavit of Motor Vehicle Sale (TC96-159) completed by the seller
- Bill of sale from the seller on the autobody shop’s letterhead (KRS 186.200)
- Kentucky Application for Title and Registration (TC96-182)
- Affidavit of newspaper advertisement publication & copy of the advertisement
- All certified mail receipts (green or white slip) and the return receipt (green slip) from the owner(s) and the lienholder(s)
- Sheriff’s inspection if the vehicle was last registered outside of Kentucky
The Kentucky mechanic’s lien process is an important part of the automotive industry. Commonly, however, mechanic’s liens are filed on a car before the work is finished or in bad faith. To prevent fraudulent applications, the DMV frequently checks the authenticity of mechanic’s liens. If you have done everything right but your application was not accepted by the DMV, do not panic. The steps to filing a mechanic’s lien are complex and often error-prone, so it is unavoidable that some mistakes will be made along the way. To ensure that your application was not rejected in error, resubmit it with any changes requested by the DMV. If your lien application was rejected by the DMV for erroneous reasons and you feel it was appropriate, there are many steps you can take to ensure that your mechanic’s lien is recognized as valid.
For more information on the mechanic’s lien process in Kentucky, click here for a PDF link to these statutes.