Lien Waiver

DEFINITION of 'Lien Waiver'

A document from a contractor, subcontractor, supplier or other party holding a mechanic's lien stating that they have been paid in full and waiving future lien rights to the disputed property. Generally, there are four types of lien waivers:

  1. An "Unconditional Waiver and Release Upon Progress Payment" discharges all claimant rights through a specific date, with no stipulations;

  2. A "Conditional Waiver and Release Upon Progress Payment" discharges all claimant rights through a specific date, provided the payments have actually been received and processed.

  3. An "Unconditional Waiver and Release Upon Final Payment" extinguishes all claimant rights upon receipt of payment

  4. A "Conditional Waiver and Release Upon Final Payment" extinguishes all claimant rights upon receipt of payment, with certain provisions.


BREAKING DOWN 'Lien Waiver'

In the United States, many states typically only recognize conditional waivers on progress payments and unconditional waivers upon final payments. Just as a mechanic's lien can be a great aid to those seeking payment for services rendered, a lien waiver can be a lifesaver for owners that have made full or partial payments.

RELATED TERMS
  1. Lien Sale

    The sale of the claim or "hold" placed on an asset to satisfy ...
  2. Construction Lien

    A claim made against a property by a contractor or other professional ...
  3. Property Lien

    A property lien is a legal claim on a tract of real estate granting ...
  4. Mechanic's Lien

    A guarantee of payment to builders, contracters and construction ...
  5. Tax Lien

    A legal claim by a government entity against a noncompliant taxpayer's ...
  6. Lien

    The legal right of a creditor to sell the collateral property ...
Related Articles
  1. Home & Auto

    To Rent Or Buy? The Financial Issues

    Thinking of buying a home? We look at the initial and ongoing costs, as well as the so-called benefits.
  2. Taxes

    Will Your Home Sale Leave You With Tax Shock?

    Learn how the newest tax laws apply to the proceeds you earn.
  3. Home & Auto

    4 Types Of Home Renovation: Which Ones Boost Value?

    You think your updated house looks great, but potential buyers may not feel the same way.
  4. Investing Basics

    The Complete Guide to Financing an Investment Property

    If you're considering adding an investment property to your portfolio, you need to know what your options are for financing its purchase.
  5. Investing

    Why We’re Bearish On U.S. Housing

    Hedgeye analyst Josh Steiner discusses the reasons behind our decision to go from bullish to bearish on the U.S. housing market.
  6. Home & Auto

    9 Tips for Handling Homeowners’ Associations

    Before you buy property in a community with an HOA, there are nine things you should do.
  7. Investing

    FIRPTA Changes Beneficial For Real Estate Sector

    Changes to the FIRPTA law provide a more favorable tax treatment to foreign investments in U.S real estate, which is likely to attract more investment.
  8. Home & Auto

    Understanding Private Mortgage Insurance

    Private mortgage insurance, or PMI, protects lenders against loss if a borrower defaults.
  9. Home & Auto

    6 Books for Rental Property Investors

    We'll look at six books that can help make you a better rental property investor.
  10. Home & Auto

    How to Price Your Home Like the Pros

    Selling a house without using a realtor can be a difficult task. Thankfully the internet has made it easy to list a home like the pros do.
RELATED FAQS
  1. How is market value determined in the real estate market?

    Anyone who has ever tried to purchase or sell a home has probably heard a lot about the property's fair market value, or ... Read Full Answer >>
  2. What is the difference between adjusted and regular funds from operations?

    While regular funds from operations measures the cash flow generated by the operations of a real estate investment trust ... Read Full Answer >>
  3. What are examples of typical leasehold improvements?

    Typical leasehold improvements include partitioning a large, open space into smaller, more structured areas such as dressing ... Read Full Answer >>
  4. How much of the global economy is comprised of the real estate sector?

    The commercial and residential real estate industry generated an estimated $3 trillion in 2014, with some 35% of sector revenue ... Read Full Answer >>
  5. What is the process for a building owner depreciating leasehold improvements in a ...

    As long as the building owner is the person or entity that provides leasehold improvements, then the owner can depreciate ... Read Full Answer >>
  6. How can I invest in tax liens?

    An individual can invest in tax liens by identifying available liens and then participating in auctions where property tax ... Read Full Answer >>
Hot Definitions
  1. Black Swan

    An event or occurrence that deviates beyond what is normally expected of a situation and that would be extremely difficult ...
  2. Inverted Yield Curve

    An interest rate environment in which long-term debt instruments have a lower yield than short-term debt instruments of the ...
  3. Socially Responsible Investment - SRI

    An investment that is considered socially responsible because of the nature of the business the company conducts. Common ...
  4. Presidential Election Cycle (Theory)

    A theory developed by Yale Hirsch that states that U.S. stock markets are weakest in the year following the election of a ...
  5. Super Bowl Indicator

    An indicator based on the belief that a Super Bowl win for a team from the old AFL (AFC division) foretells a decline in ...
Trading Center