Owner Bonded Off Your Colorado Mechanic’s Lien?

You recorded a Colorado mechanic’s lien. Then you get a notice that the owner posted a bond and the lien was released from the property. That feels like the claim disappeared. Under Colorado law, that is usually not what happened — the security changed.

This guide walks through C.R.S. 38-22-131, 38-22-132, and 38-22-133 in plain English: who may bond off a lien, how much the bond must be, what the release does, and what you must do next to keep the claim alive.

Owed $10,000 or more and legal costs are the holdup? Request a free claim review.

Bonding off a lien is a substitution, not a free wipe

Colorado lets certain owners replace the property with a court-approved bond or undertaking. After the right court steps and recording, the lien comes off the real estate and the bond stands in its place. Your claim for payment can still proceed — but you sue on the bond, on the same clock that applied to foreclosing the lien.

If you are still building the original lien file, start with the Colorado Mechanic Lien Guide 2026, NOI deadlines, and foreclosure timeline.

Who may file the bond (C.R.S. 38-22-131)

Whenever a mechanic’s lien has been filed under Article 22, the owner — whether of a legal or beneficial interest in the property — may, at any time, file with the clerk of the district court in the county where the property sits a corporate surety bond or another undertaking approved by a judge of that district court (C.R.S. 38-22-131(1)).

Key points from the statute:

• Amount. The bond or undertaking, plus costs allowed to date, must equal one and one-half times the amount of the lien plus costs allowed to date, and a district judge must approve it (C.R.S. 38-22-131(2)).
• Condition. If you are finally adjudged entitled to recover on the claim behind the lien, the principal or sureties must pay the judgment, plus interest, costs, and other sums you would have been entitled to recover on foreclosure (C.R.S. 38-22-131(3)).
• Timing. The statute says the owner may bond “at any time.” It does not give a short mandatory window for the owner to act.

What the release does to the property (C.R.S. 38-22-132)

After the court approves the bond or undertaking under 38-22-131, and after a certificate of release is issued and recorded, the lien against the property — and any related notice of lis pendens or notice of commencement of an action on that lien — is immediately discharged and released in full (C.R.S. 38-22-132).

The statute goes further: the real property described in the bond is forever released from that lien, from those notices, and from an action brought to foreclose that lien. The bond is substituted. You generally should not keep trying to foreclose against the land as if the lien were still attached.

The district court clerk issues the certificate of release. It is recorded in the county where the original lien was filed.

Your next move: sue on the bond (C.R.S. 38-22-133)

When a bond or undertaking is filed under 38-22-131, the person who filed the original mechanic’s lien may bring an action on that bond or undertaking (C.R.S. 38-22-133).

The deadline is the same as lien foreclosure. The action on the bond must be commenced within the time allowed to start a foreclosure of the lien, and the same statute of limitations applies as if no bond had been filed. For most Colorado mechanic’s liens, that ties back to the six-month enforcement window in C.R.S. 38-22-110 (lawsuit filed and notice recorded within six months after last work or completion — ask counsel how that maps onto your bonded file).

Practically: get the bond papers, calendar the foreclosure deadline you already had, and talk to counsel immediately about naming the surety and principal correctly. Do not assume the bond “pauses” the clock.

What bonding off does — and does not — mean

• Does: Clear title so the owner can sell, refinance, or close while the payment fight continues against the bond.
• Does: Give you a substitute source of recovery if you prove the claim.
• Does not: Automatically pay you. You still have to win (or settle) the underlying claim.
• Does not: Erase related contract, trust-fund, or other non-lien theories that may exist under C.R.S. 38-22-124 and other law — counsel evaluates those separately.
• Does not: Give you infinite time. 38-22-133 keeps you on the foreclosure clock.

Documents to gather after a bond-off

1. Recorded lien statement and notice of intent.
2. Court order approving the bond or undertaking, and the bond itself (principal, surety, amount, claim description).
3. Recorded certificate of release.
4. Your last day of work / completion facts for the six-month calendar.
5. Contract, invoices, change orders, and payment history supporting the claim amount.
6. Any pending foreclosure complaint or lis pendens (counsel will redirect strategy to the bond).

Where claim funding may fit

Darkwell provides litigation funding. In select cases, and where state law allows, Darkwell may purchase a claim for cash. We review claims of $10,000 or more, subject to review and approval by our team. Darkwell works in select states where our model is allowed, including Colorado, Wyoming, Florida, and California. Darkwell does not buy or collect consumer debt in states that require a collection license, including Colorado.

Darkwell may fund contractor claims against homeowners or businesses — including files where the property lien was bonded off and the live fight is now against a surety bond. We are not a law firm. Funding is for eligible claims when documents, collectability (including the bond), and legal cost make review worthwhile.

If counsel cost is the bottleneck, also read when you can’t afford an attorney, funding vs a lien attorney, and mechanic lien attorney alternative. If the lien expired before enforcement, see My Mechanic Lien Expired — Now What?.

Practical next steps

1. Confirm the bond was court-approved and the certificate of release was recorded.
2. Calendar the same deadline you would have had to foreclose the lien.
3. Have a Colorado construction attorney open (or amend) an action on the bond under 38-22-133.
4. If cost is blocking that suit and the claim is $10,000+, request a free claim review.

Bonded off and need capital to pursue the surety claim? Submit a free claim review at Darkwell Capital or email team@darkwellcapital.com. Send what you have, and you’ll get a response from our team.

Related reading: Colorado Mechanic Lien Guide · Foreclosure Timeline · Contractor Not Getting Paid · Judgment Collection Funding · FAQ · About