Glossary

Lien Waiver

A document signed by a contractor, subcontractor, or supplier relinquishing its right to file a mechanic's lien against a property, typically delivered in exchange for payment.

Lien waivers come in four common forms distinguished by whether payment has actually cleared and whether the waiver covers only work paid to date (partial) or all work through project completion (final): conditional partial, unconditional partial, conditional final, and unconditional final. Construction lenders require executed lien waivers from the general contractor and, on larger projects, from major subcontractors as a condition of each draw disbursement, since an unconditional waiver forecloses the ability of that party to later lien the property for the waived amount even if the underlying payment is later disputed. A gap in the chain of lien waivers — for example, a subcontractor who was never asked to waive rights — is a common source of after-the-fact title claims on completed construction projects.