Posted in Finance, Accounting and Economics Terms, Total Reads: 556
Definition: Lien Waiver
Lien Waiver is a concept which states that lein on a controversial property can be exercised by suppliers, contractors etc that a complete payment has been made to them. The document is also needed when payment is done and money is received by the contractors during a construction.
Lien can be defined as a right given by the owner of the property to another to secure a debt or any created by law in favor of certain creditors. It is like a mortgage on one person’s property.
Waiver can be defined as the voluntary surrender of a right. Lien Waiver can thus be described as voluntarily waiving of the right on one’s property.
Lien Waiver can be of various types. The most prominent are conditional waiver on progress payment, unconditional waiver on progress payment, conditional waiver on final payment, unconditional final waiver final payment. There can be various pitfalls in the contract thus the contract and the policies should be reviewed on timely basis. Lien waiver has become a general practice nowadays. A lien waiver can work out as a lifesaver for owners who have made full or partial payments, a mechanic’s lien can help those seek payments for the services rendered by them.