Building Code Administrators and Inspectors Florida Principle and Practice Licensure Practice Exam

What is one way an owner can reduce the risk of having a lien filed against their property?

1. Have the contractor submit an affidavit that all persons are paid

2. Stay active on the project and communicate with subcontractors

3. Have the contractor obtain a performance bond

4. Have the contractor obtain a payment bond

The correct answer is: Have the contractor obtain a payment bond

Having the contractor obtain a payment bond is a key strategy for an owner to reduce the risk of a lien being filed against their property. A payment bond ensures that the contractor has the necessary resources to pay all subcontractors, suppliers, and laborers involved in the project. If the contractor fails to make these payments, the payment bond provides financial security by guaranteeing that these parties will be compensated, which significantly mitigates the likelihood of them filing a lien against the property due to nonpayment. This proactive measure not only protects the owner from potential claims but also fosters a smoother project execution. With a payment bond in place, subcontractors and suppliers can feel secure knowing they will be paid, which in turn helps maintain positive relationships between all parties involved in the project.