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Pennsylvania Mechanics’ Lien Law Amended, Clarifying Open-End Construction Loan Mortgage Priority

On July 9, 2014, Pennsylvania Governor Tom Corbett signed into law Act 117 of 2014, which amends the Pennsylvania Mechanics’ Lien Law (MLL), 49 P.S. 1101, et seq., to provide that a construction loan secured by an open-end mortgage where at least 60 percent of the proceeds are “intended to pay or used to pay” all or part of the “costs of construction” will have lien priority ahead of any filed mechanics’ lien claims, even when the visible commencement of work was prior to the recordation of the open-end mortgage.

Click here to read the full Alert, written by Duane Morris associate Louise S. Melchor.