A mechanic's lien is the construction industry's collection tool. Because the work becomes part of the property, the law in every US state lets the unpaid contractor, subcontractor or supplier attach a claim to the property itself. The owner can't sell or refinance cleanly until it's resolved, which is why it works. The rules are strict and vary by state: preliminary notices may be required early in the job, and the deadline to record a lien after the last work is often only a few months.
A worked number
A tile sub finishes a $6,200 job in March and isn't paid. In a state with a 90-day recording deadline, the lien must be filed by late June; a sub who waits until the GC "gets to it" in July has lost the right. A lien recorded in time usually gets paid at the next refinance or sale, with interest in some states.
The mistake it hides
Assuming the owner's payment to the GC protects the owner. In many states an owner who paid the GC in full can still face a sub's lien if the GC didn't pay the sub, which is why owners collect lien waivers with every draw. For a small contractor, the lien is also a reminder that unbilled and uncollected money has a clock on it.
In Obra
Each project shows what's left to collect against the contract and the date of each payment, so an overdue draw is visible before the notice deadline rather than after. Notices and liens themselves are state forms; a construction attorney or your state's contractor board publishes them.