How to Collect Lien Waivers from Subcontractors (Conditional vs. Unconditional)
A lien waiver is the subcontractor's written promise that, for the money you are paying, they will not file a mechanics lien against the project. Collect the right one at the right moment and paying a sub never turns into paying twice. Collect the wrong one, or none, and an unpaid sub-tier supplier can put a lien on a job you already paid for.
Collect a conditional waiver with every invoice, before you pay, and an unconditional waiver for that amount once the payment has cleared. Use progress waivers during the job and finalwaivers at closeout. In states with statutory forms, such as California and Texas, the waiver must follow the statute's wording. On larger jobs, collect waivers from sub-tier subcontractors and suppliers too.
Key Takeaways
- Conditional before payment, unconditional after it clears. Never the other way round.
- Match every waiver to an invoice: same amount, same "through" date.
- Some states require statutory forms. Use your attorney’s forms for each state you work in.
- Keep one log per invoice so a missing waiver is visible before the next payment, not at closeout.
1. What a Lien Waiver Does
Anyone who supplies labor or materials to a construction project usually has the right to file a mechanics lien if they are not paid. That right exists even when the owner or general contractor paid the next tier up in full. A lien waiver is a signed release of that right, for a stated amount, through a stated date.
For a general contractor, waivers do two jobs. They protect the owner, who will usually require them from you before releasing your own payment. And they protect you from paying for the same work twice: once to your subcontractor, and again to the supplier your subcontractor never paid.
This guide explains common practice. It is not legal advice. Lien law differs by state, so have a construction attorney review your waiver forms and process.
2. Conditional vs. Unconditional, Progress vs. Final
Waivers vary along two lines. Conditional or unconditional decides whether the waiver depends on the payment clearing. Progress or final decides whether it covers one payment or the whole job. That gives four types:
| Waiver type | When to collect it | What it waives |
|---|---|---|
| Conditional progress | With each invoice or pay application, before you release that payment. | Waives lien rights for the work billed, but only once the payment actually clears. |
| Unconditional progress | After that progress payment has cleared, usually with the next invoice. | Waives lien rights for the amount paid, effective on signing. |
| Conditional final | At closeout, with the final invoice and before the last payment, including retainage. | Waives all remaining lien rights on the project once the final payment clears. |
| Unconditional final | After the final payment has cleared. | Waives all remaining lien rights, effective on signing. Nothing is left to claim. |
The reason for the order is simple. A sub who signs an unconditional waiver before the money arrives has given up their lien rights for nothing, so a careful sub will refuse. A conditional waiver protects both sides: you have the release in hand when you pay, and it only takes effect if the payment goes through.
3. When to Collect Each One
- With each invoice:a conditional progress waiver for the amount billed, through the billing date. Make it part of what "a complete invoice" means, so an invoice without one is simply not ready for approval.
- After each payment clears:an unconditional progress waiver for the amount actually paid. Most GCs collect it with the sub's next invoice, which is also when the owner usually asks you for yours.
- At closeout: a conditional final waiver with the last invoice, before you release the final payment and retainage. Then an unconditional final waiver once that payment clears.
- From lower tiers:on larger contracts, ask each sub for waivers from its own sub-subcontractors and major suppliers for the same period. Where a supplier's balance is large, a joint check payable to the sub and the supplier is another common safeguard.
4. States With Statutory Lien Waiver Forms
In most states, the parties choose the waiver wording. A minority of states write the form into law, and a waiver that departs from it may not be enforceable. Examples include California (Civil Code sections 8132 to 8138, one form for each of the four types), Texas (Property Code section 53.284), Georgia (O.C.G.A. section 44-14-366) and Arizona (A.R.S. section 33-1008). Several other states have their own forms or rules too.
The practical rule: keep a set of attorney-approved forms for each state you build in, and do not accept a sub's homemade waiver on a project in a statutory-form state.
5. Five Mistakes That Leave You Exposed
- Amount or date mismatch. A waiver for less than you paid, or through an earlier date, leaves the gap open. Check both against the invoice.
- Paying before the conditional waiver arrives. Once the money is gone, so is your leverage to get the paperwork.
- Never collecting the unconditional waiver. A conditional waiver alone leaves room to argue about whether the payment cleared.
- Ignoring lower tiers. Your sub's waiver does not release a supplier your sub did not pay.
- Keeping waivers in an inbox. If you cannot answer "which payments are missing a waiver?" in a minute, you will find out at closeout, when it is hardest to fix.
6. A Simple Waiver Log
Whether it lives in a spreadsheet or software, track waivers per invoice, not per subcontractor. One row per invoice with these columns is enough:
- Subcontractor and project
- Invoice number, amount and "through" date
- Conditional waiver received (date)
- Payment date and amount actually paid
- Unconditional waiver received (date)
- Lower-tier waivers received, if required
Before each payment run, filter for rows with a payment scheduled and no conditional waiver. Before each new invoice, filter for paid rows with no unconditional waiver. Those two lists are your follow-ups.
7. Collecting Lien Waivers in SubDoc
If your subcontractors already invoice through SubDoc, waivers can follow the payments automatically.
- Lien waivers are optional. Once an owner or admin turns them on, SubDoc requests a conditional waiver when an invoice is approved and an unconditional waiver when it is marked paid.
- If you have a signing template for that waiver type, such as your attorney’s state form, it goes to the sub for e-signature. Otherwise the sub gets a link to upload the signed waiver.
- A missing conditional waiver blocks the invoice from being scheduled or marked paid. Only the workspace owner can override or waive it, and that is recorded.
- The same payment gate also blocks invoices from subs whose insurance or required documents are not current.
For the rest of the paperwork that should be in before the first payment, see collecting a W-9 and COI from subcontractors.
Frequently Asked Questions
A conditional waiver only takes effect once the payment it describes actually clears. An unconditional waiver takes effect when it is signed, whether or not the money arrived. That is why you collect a conditional waiver before you pay and an unconditional one after the payment has cleared.
With every payment. Ask for a conditional progress waiver with each invoice or pay application, before you release the payment, and an unconditional progress waiver for that amount once it has cleared, usually with the next invoice. At closeout, collect a conditional final waiver before the last payment and an unconditional final waiver after it.
On larger jobs, yes. A sub-tier subcontractor or supplier who is not paid by your subcontractor may still be able to file a lien against the project, even though you paid your sub in full. Ask your subcontractors for their lower-tier waivers with each invoice, or pay large suppliers with joint checks.
In some states, yes. California, Texas, Georgia and Arizona are among the states that set out statutory lien waiver forms, and a waiver that does not follow the required form may not be enforceable there. In other states the wording is up to the parties. Have a construction attorney supply the forms for the states you work in.
They can, and before they are paid they usually should. Signing an unconditional waiver for money that has not cleared gives up lien rights for nothing. Ask for the conditional version before payment and the unconditional version after, and most subs will sign without argument.
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