What is a lien waiver in construction?
A lien waiver is a signed statement that a contractor, sub or supplier has been paid, and gives up its right to file a mechanic's lien for that amount. Owners and general contractors ask for one with each payment so they don't pay twice for the same work.
The four types of lien waiver
| Type | Use it when |
|---|---|
| Conditional, progress | You're about to receive a progress payment. It only takes effect once the money clears. |
| Unconditional, progress | You've already been paid a progress payment. |
| Conditional, final | You're about to receive the final payment. |
| Unconditional, final | You've received final payment and the job is closed out. |
The safe habit: sign conditional waivers before you're paid, and unconditional ones only after the money is in your account. An unconditional waiver works against you even if the check bounces.
Partial lien waivers
A "partial" lien waiver is another name for a progress payment waiver. It covers work through a date, and leaves your rights for retention, extras and later work in place. List anything unpaid under Exceptions.
States with their own lien waiver forms
About a dozen states, including California, Texas, Georgia, Florida and Arizona, set out the exact wording a lien waiver must use. In those states, a waiver that doesn't follow the statutory form may not be valid. If your job is in one of them, use the state's form, and use this one as a checklist for the details you'll need.
Lien waivers and getting paid
Send the conditional waiver with your invoice, so the customer has everything they need to pay you the same day.
Questions
Should I sign an unconditional lien waiver before I'm paid?
No. An unconditional waiver releases your lien rights even if the payment never arrives. Sign a conditional waiver until the money has cleared.
Is this lien waiver valid in every state?
No. Several states require their own statutory wording. Check your state's rules, and have an attorney review waivers for large jobs.
What goes under exceptions on a lien waiver?
Anything you haven't been paid for yet that this payment doesn't cover, such as retention, approved change orders and disputed amounts.