Conditional vs Unconditional Lien Waivers, Explained

A lien waiver is a receipt for lien rights: the sub says "for this payment, I give up my right to lien the property." Banks require them because a funded draw with no waivers means the property can still be liened for the same work — the lender's collateral gets worse as the loan pays out.

The four types

• Conditional progress — effective only when the progress payment clears. The default for draws.
• Unconditional progress — effective immediately upon signing. Only sign after the money is actually received.
• Conditional final — full and final waiver, contingent on the final payment clearing.
• Unconditional final — full release, effective now. The one to be most careful with.

The one rule

Conditional before payment, unconditional after. A sub who signs an unconditional waiver before the check clears has given up lien rights for money they may never see. A builder who demands that is asking subs to carry the payment risk — and good subs price that in or walk.

Some states (California, Texas, and others) prescribe statutory waiver forms — using the wrong language can make a waiver unenforceable. Check your state's requirements.

Getting them signed without the chase

The practical pain isn't choosing the type — it's collecting signatures from six subs the week the draw is due. NeatBuild drafts each waiver from the actual bills, texts or emails the sub a signing link, and files the signed PDF into the draw package. You see who hasn't signed before the bank does.