A Lien Waiver is an essential tool in the construction industry. It helps to protect your company by reducing potential liabilities and allows you to provide a better service to your end customer. Since a Lien Waiver is issued at several different times through the life of a project, this document requires some special attention.

You may be asking yourself “What is a Lien Waiver and how does it affect a construction project?”. This guide aims to answer that and more. Having a solid Lien Waiver process can make a big difference in protecting your project, client and reputation.

A Lien Waiver is a legal document that is signed, usually by a Subcontractor, that relinquishes their right to issue a Lien against your project. A Subcontractor, by virtue of being Subcontracted, has the right to issue a Lien against your project for non-payment.

Normally, a Lien Waiver is exchanged prior to, and after payment has been made on a Subcontractors invoice. It states that the owner, either intends to, or has already made payment for the work performed on the job and due to that the Subcontractor relinquishes their right to issue a Lien against the property.

If that sounds complicated, here is an easier way to understand it. Consider a Lien Waiver as a form of receipt. It’s a document that proves a Subcontractor will or has received payment for their part in a project. Because of that, they agree that they will not file a Lien against the property.

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