A lien waiver is a document where you give up some or all of your right to file a mechanic's lien, in exchange for payment. They're exchanged alongside pay applications on almost every commercial job. The single most important thing to understand is one word: conditional vs. unconditional.
Conditional vs. unconditional — the difference that matters
- Conditional waiver: takes effect only when you actually get paid — e.g., when the check clears. If payment never arrives, you keep your lien rights. This is the safe one to sign before money is in hand.
- Unconditional waiver: takes effect the moment you sign it, paid or not. If you sign one and the payment bounces, you may have waived your rights with nothing to show for it. Only sign unconditional waivers after the money has landed in your account.
Progress vs. final
The other axis is which payment the waiver covers:
- Progresswaiver: covers a single progress payment (this period's draw). You'll sign one most months.
- Finalwaiver: covers the last payment and waives all remaining lien rights on the project, including retainage. Don't sign a final waiver until you've been paid everything — including released retainage.
The four types
| Type | Covers | Effective when |
|---|---|---|
| Conditional progress | This period's payment | When you receive that payment |
| Unconditional progress | This period's payment | Immediately on signing |
| Conditional final | Final payment + all rights | When you receive final payment |
| Unconditional final | Final payment + all rights | Immediately on signing |
How waivers pair with your pay application
The usual rhythm: you submit your pay app with a conditional progress waiverfor the amount you're billing ("I waive my lien for this draw once I'm paid"). After the payment clears, the GC may ask for an unconditional progress waiver confirming you received it. Sending the conditional waiver up front keeps the draw moving without exposing you.
Watch the form and your state
Some states require specific statutory waiver forms with exact language; others let you use your own. Using the wrong form — or signing an unconditional waiver too early — is one of the most expensive mistakes a sub can make. Use the form your contract and state require. This is general information, not legal advice; when in doubt, ask an attorney.
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