Lien Waiver
Also known as: waiver of lien · lien release
A lien waiver is a document in which a contractor, subcontractor, or supplier gives up their right to file a mechanics lien against a property, in exchange for payment. General contractors typically require one with every pay application.
The four common types
| Type | Applies to | Signed |
|---|---|---|
| Conditional partial | One progress payment | Before payment; only takes effect once payment clears |
| Unconditional partial | One progress payment | After payment received |
| Conditional final | The whole contract | Before final payment; effective on clearing |
| Unconditional final | The whole contract | After final payment received |
Conditional and unconditional are not interchangeable
An unconditional waiver signed before the money actually arrives gives up lien rights whether or not you are paid. This is a routine and consequential error. Some states prescribe statutory waiver forms; many do not.
Mechanics lien law is state-specific and deadline-driven, including preliminary notice requirements that can apply within weeks of first furnishing labour or materials. Missing a notice deadline can forfeit lien rights entirely. Consult an attorney in your state — nothing here is legal advice.
Related terms
- Pay ApplicationA pay application is the monthly invoice a subcontractor submits for work completed during a billing period. It states the percentage complete of each schedule-of-values line item, subtracts retainage and previous payments, and arrives at the amount currently due.
- RetainageRetainage is a percentage of each progress payment withheld by the owner or general contractor until the work is complete and accepted. Five to ten percent is commonly seen, and it is released after substantial completion and closeout.
- Substantial CompletionSubstantial completion is the point at which a project is sufficiently finished that the owner can occupy and use it for its intended purpose, even if minor items remain. It typically starts warranty periods, ends liability for liquidated damages, and triggers the process that releases retainage.