Can an Unlicensed or Non-Permitted Contractor File a Mechanics' Lien in Colorado?
Many homeowners assume that if a contractor records a mechanic’s lien, the contractor must have had the legal right to perform the work in the first place. Unfortunately, that is not always true. In Colorado, some contractors perform work without the required local licenses, skip mandatory building permits, or perform specialty trades they are not qualified—or even legally allowed—to do. These violations do more than raise safety concerns. They strike at the heart of the contractor’s lien rights.
Colorado lien law protects only those who provide lawful improvements to property. When the work is unlicensed or unpermitted, it may not be lawful at all. This distinction becomes critical when evaluating whether a contractor who violated licensing or permitting rules can enforce a mechanic’s lien.
For homeowners new to the topic, background on lien rights in general can be found in Understanding Mechanics Liens in Colorado: A Homeowner’s Guide.
How Licensing Requirements Affect Lien Rights
Colorado does not have a single statewide contractor license, but almost all municipalities impose licensing requirements for general contractors, electricians, plumbers, mechanical contractors, and other specialty trades. Without the proper license, a contractor may not legally perform the work, may not obtain required permits, and may not pass required inspections.
A contractor who violates these rules starts the project on legally shaky ground. Because mechanic’s liens secure payment for improvements that genuinely increase property value, work performed unlawfully may fail to qualify as an “improvement” under the lien statute, C.R.S. § 38-22-101 et seq. If the contractor was unlicensed to perform the work, especially in trades where public safety is involved, courts are often skeptical that the contractor should receive the powerful remedy of a mechanic’s lien.
Homeowners who want to verify local licensing requirements can find them through their municipality’s building or permitting department. For example, Denver’s licensing rules are available through the Denver Community Planning and Development website. Similar resources exist for Aurora, Colorado Springs, Fort Collins, and most counties.
Why Unpermitted Work Undermines Lien Claims
Permit violations are even more damaging to a contractor’s lien rights. Many residential projects require permits: structural changes, electrical work, plumbing, HVAC modifications, roofing, and basement finishes, among others. When a contractor fails to obtain required permits:
The work may violate building codes
Inspectors may require demolition or corrections
The home may not legally pass future inspections or appraisals
The project cannot be lawfully completed as constructed
Under these circumstances, the “improvement” is not actually an improvement. It is a liability. Because Colorado’s lien statute protects only actual, lawful value added to property, unpermitted work greatly weakens a contractor’s claim.
These issues often arise alongside defective or incomplete work, which we discuss more thoroughly in What to Do When a Contractor Files a Lien for Incomplete Work.
How Permitting and Licensing Failures Intersect With Other Lien Defects
Contractors who skip licensing and permitting requirements often display the same patterns elsewhere in the project. They may abandon the job once confronted about missing permits, file inflated invoices, or retaliate against homeowners who insist on code compliance. These behaviors commonly appear in the cases we describe in Fraudulent or Retaliatory Mechanic’s Liens in Colorado and Can a Contractor File a Mechanic’s Lien After Abandoning the Job?.
A contractor who violates licensing or permitting regulations may also file liens late. Because these contractors often struggle with documentation or avoid scrutiny from inspectors, they frequently miss the strict deadlines for recording a mechanic’s lien. The consequences of late filing are detailed in How Long Does a Contractor Have to File a Mechanic’s Lien?.
When multiple defects overlap—unlicensed work, unpermitted work, incomplete work, and inflated billing—the contractor’s lien rights erode quickly.
How Homeowners Can Use Licensing and Permit Violations to Challenge a Lien
The process of challenging a mechanic’s lien begins with identifying the contractor’s legal authority to perform the work. Homeowners can request permit records from their local building department, check contractor licensing databases, and review inspection histories. Many permitting departments allow online searches showing whether permits were ever pulled and whether they passed or failed inspection.
Once evidence of violations is gathered, those facts become powerful tools for challenging the lien. A contractor who performed unlicensed HVAC work, unpermitted electrical work, or structural modifications without engineering approval has exposed the homeowner to real risks. It would be fundamentally unfair for such a contractor to leverage the lien statute to force payment for unlawful work.
Why Experienced Legal Help Is Essential When Permits or Licenses Were Not Properly Obtained
A contractor who performs unlicensed or unpermitted work has already shown disregard for legal requirements. When such a contractor files a lien, the homeowner is dealing with a party who is willing to use statutory remedies aggressively—despite failing to follow the law themselves. In this setting, having counsel familiar with Colorado lien statutes, local licensing rules, and construction-defect law becomes essential.
An attorney can analyze the extent of licensing violations, obtain public records from building departments, evaluate whether work must be demolished or repaired, and use those facts to invalidate the lien and pursue damages. In many cases, unlicensed or unpermitted work becomes the key that unlocks a full resolution of both the lien and the broader construction dispute.
The information provided on this website is for general informational purposes only and should not be construed as legal advice or legal opinion. You should not act or refrain from acting on the basis of any information provided on this website without seeking legal advice from an attorney.