In Texas, a monthly notice is a document that protects the right to file a mechanics lien if payment is not made. It is a type of preliminary notice specific to Texas construction projects. Here's what you need to know about the rules and requirements for sending preliminary monthly notices in Texas.
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GCs are not required to send monthly notices on private jobs in Texas.
Texas contractors who contract directly with the owner do not need to send preliminary notice. However, on residential projects, the general contractor must give the owner a disclosure statement before signing the contract, and a written list of all the subs and suppliers intended to be used.
GCs are not required to send notice on public jobs in Texas.
On public jobs, any claims for non-payment are made against the general contractor's bond. Since GCs will not make a claim against their own bond for non-payment, they do not have bond claim rights, and have no preliminary notice requirement.
In Texas, all subcontractors and suppliers not hired directly by the owner must send monthly notices on private construction jobs in order to retain lien rights.
For residential projects, sub-tier parties must send notice to the owner and prime contractor by the 15th day of the 2nd month following the month that work was performed and unpaid. (Notice must be sent for each month work was performed and unpaid.)
On non-residential projects, all subcontractors and suppliers must send a 3rd month notice following each month work was performed and unpaid.
Note: On projects where the original contract was entered into before 1/1/22, a 2nd-month notice must also be sent on non-residential projects by all those who didn’t contract directly with the GC, in addition to the 3-month notice mentioned above.
In Texas, all subcontractors and suppliers not hired directly by the owner are required to send notices on public construction jobs in order to retain bond claim rights.
First-tier subcontractors and suppliers must send notice by the 15th day of the 3rd month following each month work was performed and unpaid.
Subs or suppliers who contracted with a party other than the direct contractor must send a notice by both the 15th day of the 2nd month, and the 15th day of the 3rd month following each month in which work was performed and unpaid.
A 2nd month notice must be sent to the GC. The 3rd month notice must be sent to the GC and the surety.
TopicThese are some frequently asked questions about the notice requirements in Texas, with answers written by construction attorneys and payment experts in Texas.
NOTE: There are some significant changes to the Texas private project notices for all original contracts entered into on or after January 1, 2022. These FAQs break down both the rules in effect now, and those that apply to projects started prior to the 2022 Changes.
The general contractor is generally not required to give any preliminary notice. However, on residential projects, the general contractor must give the owner a disclosure statement before signing the contract, and a written list of all the subs and suppliers intended to be used (updated periodically) unless the owner has specifically waived this requirement in writing (the waiver may be part of the original contract).
• NOTE on homestead projects: In order to obtain a lien on a homestead, the general contractor must execute and file with the county clerk a written contract setting forth the terms of the contract prior to the furnishing of labor and/or materials signed by both spouses if the owner is married.
In Texas, all subcontractors and suppliers not hired directly by the owner are required to send monthly notices on all residential or commercial projects in the 2nd and/or 3rd months after furnishing labor or materials.
Lastly, there are also special notice requirements for claims on contractual retainage, for those who didn’t contract directly with the property owner.
The only additional notice required under the older version of Texas’ lien laws are suppliers of specially fabricated materials. Such suppliers must send this notice to secure lien rights for materials that were specifically manufactured materials that were either undelivered or unincorporated into the project.
Homeowner disclosure statement
A GC must provide the disclosure statement on residential projects prior to the execution of the contract, or included therein.
Furthermore, on homestead projects, the contract must be filed with the county clerk’s office prior to furnishing any labor or materials to the project.
Commercial project monthly notices
All claimants other than the general contractor must provide notice no later than the 15th day of the 3rd month after each month labor and/or materials were furnished.
Residential project monthly notices
Notices must be served no later than the 15th day of the month 2nd month after each month labor and/or materials were furnished
Notice of Claim for Unpaid Retainage
No later than the earlier of the 30th day after the date (a) the claimant’s contract is completed, terminated, or abandoned, or (b) the original contract is terminated or abandoned.
* Note: if the 15th lands on a weekend or federal holiday, the deadline for notices will be pushed to the next business day.
The same general rules apply, with the following exceptions:
Commercial project monthly notices
• If hired by the general contractor, notices must be served no later than the 15th day of the 3rd month after each month labor and or materials were furnished. (3-month notice)
• If hired by anyone other than the GC; notices must be served no later than the 15th day of the 2nd month after each month labor and/or materials were furnished AND the 15th day of the 3rd month after each month labor and/or materials were furnished. (2nd-month notice & 3rd-month notice)
Specially Fabricated Materials
Must be served no later than the 15th day of the 2nd month after the month the claimant receives and accepts the order for materials.
* Note: if the 15th lands on a weekend or federal holiday, it must be served prior to the 15th.
Homeowner disclosure statement
GC’s must provide the disclosure statement to the property owner on residential projects. For homestead improvements, the contract must be recorded with the Texas county clerk in the county in which the property is located.
Monthly notices (commercial & residential)
Commercial and residential project monthly notices must be served on both property owner and the general contractor.
Notice of Claim on Unpaid Retainage
Must be served on both the owner and the general contractor.
The same general rules apply, with the following exceptions:
Commercial project monthly notices
• 2nd-month notices must be served on the general contractor
• 3rd-month notices must be served on both the owner and the general contractor
Notice of Specially Fabricated Materials
• If hired directly by the general contractor, the claimant must provide notice to the owner.
• If hired by a subcontractor, then notice must be served on both the general contractor and to the owner and general contractor.
Notice of Contractual Retainage
• If hired directly by the general contractor, notice is only required to be served on the property owner.
• If hired by a subcontractor, then notice must be served on the general contractor as well.
Homeowner disclosure notice
The homeowner notice must include the statutory language set forth under Tex. Prop. Code §53.255.
Monthly notices
All monthly notices must be in the statutory format under Tex. Prop Code §53.056(a-2) and include the following information:
• Date;
• Project description/address;
• Claimant’s name, contact person’s name, and address;
• Description of labor/materials provided;
• Original contractor’s name;
• Hiring party’s name (if different from original contractor);
• Claim amount; &
• Homestead projects only: notice language under Tex. Prop Code § 53.254(g).
Notice of Claim for Unpaid Retainage
Must be in the statutory form provided under Tex. Prop. Code §53.057(a-2), and should include the following information:
• Date;
• Project description/address;
• Claimant’s name, contact person’s name, and address;
• Description of labor/materials provided;
• Original contractor’s name;
• Hiring party’s name (if different from original contractor); &
• Total amount of retainage unpaid.
The same general rules apply, with the following exceptions:
Monthly notices
Texas law doesn’t provide too much guidance on what information should be included on monthly notices besides a “notice of unpaid balance.”
However, we recommend including the following information on all notices: claimant’s name & address, the property owner’s name & address, the hiring party’s name & address, a brief description of labor/materials furnished, and a property description.
Notice of Specially Fabricated Materials
The Notice of Specially Fabricated Materials is only required to include a statement that the order was received and accepted and the price of the order
Notice of Contractual Retainage
The Notice of Contractual Retainage must state the existence of a requirement for retainage, claimant’s name & address, and (if hired by a subcontractor) then the sub’s name and address
All Texas notices should be sent by certified mail.
A contract for improvement to a homestead must be filed with the county clerk in the Texas county in which the property is located, prior to the furnishing of labor and/or materials.
Note, however, that despite the general statutory requirement to send notices by certified mail, Texas specifically states that:
“Any notice or other written communication may be delivered in person to the party entitled to the notice or to that party’s agent, regardless of the manner prescribed by law” and “[i]f a written notice is received by the person entitled to receive it, the method by which the notice was delivered is immaterial.”
If you deliver a notice by hand, it’s important to document the delivery in some way, in order to prove that the delivery occurred if necessary.
The requirement to send most Texas notices (including monthly notices) is fulfilled upon mailing.
According to Texas Property Code § 53-003(c), “If notice is sent by registered or certified mail, deposit or mailing of the notice in the United States mail in the form required constitutes compliance with the notice requirement.”
Note, however, that “[t]his subsection does not apply if the law requires receipt of the notice by the person to whom it is directed.”
If you fail to send a required monthly notice on time, it’s unlikely that you will be able to file a mechanics lien claim in Texas for that amount.
As far as the Notice of Claim on Unpaid Retainage, missing this deadline may not be necessarily fatal to a claimant’s ability to recover unpaid retainage, if the withheld amounts were included in the prior notices.
The same general rules apply, with the following exceptions:
If a custom material supplier misses the deadline to send a specially fabricated materials notice, that lien claimant may only claim for any materials that were actually delivered and used in the project.
Payment bond monthly notices
All claimants who do not have a direct contractual relationship with the prime contractor furnishing the bond must send a preliminary notice. Laborers making a claim for wages only are excepted from this requirement.
Notice of Contractual Retainage
All claimants who do not have a direct contractual relationship with the prime contractor furnishing the bond must send a preliminary notice.
Notice of Specially Fabricated Materials
Any suppliers who furnish specially fabricated materials must send a notice to secure bond claim rights to materials fabricated but not delivered or incorporated into the improvement.
Payment bond monthly notices
• First-tier Claimants (hired by prime) must send notice to the prime contractor and surety, on or before the 15th day of the third month after each month
• Second-tier claimants (hired by sub or lower) must send notice to the prime contractor on or before the 15th day of the second month after each month. AND must also send notice to the prime contractor and surety on or before the 15th day of the third month after each month
Notice of Contractual Retainage
No later than the 90th day after the date of final completion of the public work contract.
Notice of Specially Fabricated Materials
Must be served no later than the 15th day of the 2nd month after the order for specially fabricated materials was received and accepted.
* Notices must be given prior to the 15th of the month if the 15th falls on a Saturday, Sunday, or legal holiday.
Payment bond monthly notices
• First-tier Claimants (hired by prime) must send notice to the prime contractor and surety
• Second-tier claimants (hired by sub or lower) must send notice to the prime contractor on or before the 15th day of the second month after each month. AND must also send notice to the prime contractor and surety on or before the 15th day of the third month after each month
Notice of Contractual Retainage
Notice must be served on the prime contractor who posted the payment bond, and the surety who provided said bond.
Notice of Specially Fabricated Materials
Notice must be served on the prime contractor who posted the payment bond.
Payment bond monthly notices
The monthly notices should include a sworn statement of account that states the amount claim is just and true, and that all just and lawful offsets, payments, and credits known to the affiant have been allowed.
Notice of Contractual Retainage
Notice must state that the contract between the claimant and the subcontractor provides for retainage, the amount of the contract, the amount paid to date, and the outstanding balance.
Notice of Specially Fabricated Materials
The notice must state that the order has been received and accepted by the claimant.
All notices must be sent by registered or certified mail to the contractor’s residence or last known business address. If the surety is a required recipient, the notice should be sent to the surety’s address stated on the bond, or the address on file with the Texas Department of Insurance.
There is no specific requirement for actual receipt, the notice requirement is satisfied when deposited in the mail in the proper method and to the proper address.
Payment bond monthly notices
When required, if a notice is sent late, the bond claim rights for that particular month’s worth of labor and/or materials furnished will be lost.
Notice of Contractual Retainage
The claimant will not be able to make a claim for unpaid retainage against the payment bond.
Notice of Specially Fabricated Materials
The material supplier will not be able to make a claim for specially fabricated materials that aren’t delivered or incorporated into the project.
Yes You should Send a 2nd Month Notice, if you Still Yet to Be paid i'd love to talk to you more about what's happening and help get it resoved give me a call at 972-872-8783
Answered by Joshua Grider | CEOTexas law will not apply. If the project is in American Somoa, the local law will apply. So, you should retain a construction lawyer familiar with the mechanic's lien law in that part of the world.
Answered by Brian Erikson | AttorneyYour question is a bit unclear in its wording, however, it sounds like you may want to contact a collections attorney. Levelset provides a list of attorneys in each state here: https://www.levelset.com/payment-help/experts/experts-by-state/ . From that directory you may find a law firm in your area to call privately.
Answered by Julie Gelderblom | Levelset AdminTexas lien laws went through extensive changes that are effective on all original contracts entered into on or after 1/1/22 (i.e. original/prime contracts signed on or after 1/1/22)
Texas mechanics lien law requires contractors and suppliers to send monthly notices to the prime contractor and property owner. Sending these notices is a requirement in order to retain the right to file a Texas mechanics lien if they are not paid. When it comes to notice requirements, Texas mechanics lien law gets complex pretty quickly; it’s important for construction businesses to follow the rules closely.
Texas notices fall somewhere between a preliminary notice and a notice of intent to lien. A notice may be required at the start of work, but there can also be multiple notices due after each and every month in which labor is performed or materials furnished (but unpaid). This can easily result in a complex mess of paperwork that is difficult to manage, especially on long projects or projects with long payment cycles.
Part of the complexity of the Texas notice scheme is that only a few notices have specific names. The most common construction notice that is generally required by Texas law can be called a 2nd month notice or 3rd month notice (depending on which deadline applies), a “fund-trapping notice”, a preliminary notice, or something else. For the information contained on this page, we’ll use the term “monthly notice.”
A direct contractor – one who contracts directly with the property owner – is not required to send a preliminary notice on non-residential projects in Texas. However, they are required to send the owner a disclosure statement with a list of all of the subcontractors and suppliers working on the project.
Subcontractors, material suppliers, equipment lessors, or anybody that did not contract directly with the property owner, must send monthly notices in order to protect the right to file a lien.
The deadline in Texas for most construction notices is the 15th day of the month, except for the notice for a retainage claim.
The law requires a monthly notice to be sent by the 15th day of the second month or third month after each month in which the claimant performed labor or furnished materials for which they remain unpaid; depending on the project type. And, since Texas monthly notices contain language that is a bit aggressive, many Texas construction participants don’t want to send the notices unless and until absolutely necessary. This can make the 15th of the month an extremely stressful and busy day for construction companies in Texas.
All subcontractors and suppliers must send a 3rd-month notice to the owner and the general contractor on the 15th day of the 3rd month following each month work was performed and unpaid.
*Note: For projects that began prior to 1/1/22, the following rules apply
First-tier subcontractors in Texas (those who have a contract with a Direct Contractor) must send a 3rd-month notice by the 15th day of the 3rd month following each month work was performed and unpaid.
Lower-tier subcontractors, i.e. those hired by a subcontractor or lower, in addition to the 3rd-month notice must also send a 2nd-month notice as well.
In Texas, all parties who didn’t contract directly with the property owner must send a 2nd-month notice by the 15th day of the second month.
*Note: This notice is only required on projects that began prior to 1/1/22.
Texas defines specially fabricated material as “material fabricated for use as a component of the construction or repair so as to be reasonably unsuitable for use elsewhere.”
Parties who fabricate special materials for a construction project in Texas must provide a notice of specially fabricated material. This notice is due by the 15th day of the second month following the month in which the claimant received the order for the material. This notice preserves the supplier’s lien rights even if the materials aren’t delivered or used in the project.
This notice must be sent in addition to any other monthly notice that may be required, in order to retain lien rights.
In order to file a mechanics lien for unpaid retainage in Texas, a claimant must mail a notice no later than the earlier of these dates:
This calendar takes the guesswork out of calculating the deadline for your Texas monthly notices. We update it annually.
The penalties for not providing the required notices in Texas can be severe. Failure to deliver monthly notices when required (even if just one day late) eliminates the ability to file a valid mechanics lien for the amount due for the labor or material furnished in the month(s) associated with the improper notice(s).
Note: for projects that began prior to 1/1/22, failure to provide a notice of specially fabricated materials means that a claimant may only file a lien for materials that were actually delivered and incorporated into the project (provided other notice requirements are met).
