Don’T Waver On The Waivers: The Importance Of Lien Wavers

Many homeowners have found themselves in serious legal trouble following a major renovation, simply because they failed to have lien wavers signed by each and every sub-contractor who was hired to work on individual aspects of the job prior to final payment. Even if a contractor was only on-site for a few hours, it's important to have them sign a lien waver before releasing final payment to the general contractor in charge.

Lien wavers are an important way to protect yourself from having a lien put on your property due to non-payment of subcontractors by your general contractor - even if you have receipts to prove that you paid him in full for all services rendered!

Don't worry about insulting a contractor by asking him to sign a lien waver at the end of a job. They do it all of the time. Just be sure that every sub contractor who has worked in your home signs one too before releasing those payments.

It is not uncommon for the main contractor to assume responsibility for hiring the subcontractors, and paying them from the fee he charges the homeowner. After all, isn't that why people hire a lead contractor in the first place? Problems may arise, however, if the general contractor fails to pay those subcontractors in a timely manner - which, by the way happens all of the time!. Without a signed lien waver from each independent worker, the homeowner remains responsible for payment, regardless of who they've already paid for those same services.

Lien wavers protect homeowners from double paying on a specific remodeling job by ensuring that all parties understand that the general contractor will be handling subcontracting payments, thus releasing the homeowner from further payment responsibility.

What should a lien waver include? There are many excellent (and free), downloadable forms found on the internet, but for those who want to write their own make sure it includes the following:

  • Homeowner's name
  • Contractor's full name, address and telephone number
  • A complete description of the work. List the work that was performed in great detail, including the final state of the house at the completion of the job, as well as a listing of what materials should be removed from the premises.
  • Status of the work
  • Signed and dated. Be sure to have the contractor print and sign his name on two copies (one for him and one for you). Date every one!
  • Witness signature (optional, but encouraged)

It may seem like a bit of a hassle to make sure lien wavers are signed by every single subcontractor who steps into your house during a large-scale renovation project. But, failing to ensure that everyone has received payment from the general contractor, or at least releases you from further payment requirements once the job is completed, is an easy way to safeguard you from further financial responsibility, and allow you to enjoy the work that was completed.