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Posted By: Jps1006 Waiver of Lien - 09/01/05 01:55 PM
Often times contractors and owners request a waiver well before the check gets issued. What are your policies on issuing waivers? Do any of you only trade waiver for check, or do you usually give it up front?

Any horror stories of issuing a waiver early only to regret later?
Posted By: macmikeman Re: Waiver of Lien - 09/01/05 05:31 PM
Your waiver should state that the lein waiver is valid only upon reciept of full payment, and proper transfer of funds completed.
Posted By: Tiger Re: Waiver of Lien - 09/01/05 08:55 PM
Payment and a waiver are typically a trade at the same time. The exception woulb be where someone has already made a payment, then asks for a waiver (which you should give without question). It's a HUGE red flag if someone asks for a waiver without payment.

Dave
Posted By: Electric Eagle Re: Waiver of Lien - 09/01/05 10:49 PM
I either want the check in hand or if it is to be mailed, a faxed copy of the check before I send a fax of my lien waiver. I mail the waiver when I get the check.
Posted By: Active 1 Re: Waiver of Lien - 09/02/05 08:39 PM
I know a Heating contractor that fell for that. They told him "give us the final lien waiver so we can get you check". He never got paid. I didn't didn't get paid on the same job but at leat I have a lean on the home.

If a lein waiver is requested ahead of payment then It's a red flag. Maybe you get paid once then the next and bigger job you get hosed.

By giving out the lien you said your paid and give up some recoarse.

Don't believe it if they try to tell you it's allways done way before payment.

Tom
Posted By: macmikeman Re: Waiver of Lien - 09/03/05 07:19 AM
Just do it the way I said. People, most especially crooked general contractor people bounce checks. If your lein has my disclaimer, then its invaled if the check bounces. And most important it holds up in a court of law.
Posted By: iwire Re: Waiver of Lien - 09/03/05 02:17 PM
I am not an company owner so I am not that failure with the business side.

None the less I have to ask why would anyone consider waiving the right to apply a lien.

If the customer plans on paying what reason would they have for wanting the waiver?
Posted By: Tiger Re: Waiver of Lien - 09/03/05 03:21 PM
Lein waivers are a typical part of business. They are required when the project is paid through a title company. These are the best projects because the money is guaranteed. Once you are paid, you give up the right to lein the property. It is the owners way to prove that everyone has been paid when the project is complete.

Dave
Posted By: nesparky Re: Waiver of Lien - 09/05/05 02:34 AM
The best way is to use a Conditional Lien Waver worded to say that this lien waver has to have the cancelled check attached to be valid. That way if the check is not recieved or bounces the lien is not taken off.
Check with your attourney to make sure the wording on the conditional waver is accepted in your area/state. As this is a legal document you need to make sure it is correct.
Posted By: iwire Re: Waiver of Lien - 09/05/05 06:40 PM
Dave I understand that once the final payment is made that the lien needs to be released. [Linked Image]

What I am asking is why if an EC did not have the final payment in hand would they even think a second about releasing the right to apply a lien?

I am a nice guy until it comes to someone trying cost me money.

Come to think of it I guess it's good I do not own a company. [Linked Image] [Linked Image]
Posted By: Electric Eagle Re: Waiver of Lien - 09/05/05 07:29 PM
iwire,
A lien waiver is a document stating that you have been paid and release your right to lien the property. If you haven't been paid, you wouldn't sign one. If you have been paid, then there is no reason not to sign one.
Posted By: Jps1006 Re: Waiver of Lien - 09/05/05 07:38 PM
The only reason I would consider releasing my right to lien before payment would be to speed up the process of getting paid. I've only been asked for a waiver ahead of payment when a title company was involved and it was very uneventful. I like the idea of the conditional waiver. That would alieviate my concerns (provided it is appropriate here).

Quote
Come to think of it I guess it's good I do not own a company.

Not necesarrialy Bob. You would get used to the idea (although it's not an idea promoted much around here) that not everyone is out to screw you. I think very few do it maliciously. Some find out they can get away with stuff and push a little more and a little more until the next thing you know, your screwed. Others are just igorant and you get screwed because they don't have a clue. But you learn to pick up those types as quickly as you can.

The beauty of working mainly from referrals is that you always a little more leverage by going back to the person that refered, or even mentioning the referer's name to someone who might be acting undesirably can remind them of the fact that a reputaion is something that is of value.
Posted By: Tiger Re: Waiver of Lien - 09/05/05 08:50 PM
iwire, if you look at my first post I said it would be a huge red flag if someone wanted a waiver before payment.

Typically this is a trade across the counter of the title company. I sign the waiver, then they print my check. If a GC asked for a waiver I'd say, "Of course I'll give you a waiver...where's the check?"

No check, no waiver.

Dave
Posted By: Joey D Re: Waiver of Lien - 09/16/05 02:28 AM
If a job is starting to look sour can you put a lein on it beofre anything happens just to get a head start? Is anyone putting leins on any job they do as a precaution?
Posted By: Tiger Re: Waiver of Lien - 09/16/05 03:05 AM
I've heard of contractors leining property as a routine in contracting (and releasing the lien on completion and payment). I personally feel it's a great way to upset a calm client.

Dave
Posted By: macmikeman Re: Waiver of Lien - 09/16/05 04:57 PM
quote"I've heard of contractors leining property as a routine in contracting (and releasing the lien on completion and payment). I personally feel it's a great way to upset a calm client"

I part time contracted from 1980-1084, and full time since. One thing I learned during this time is it is better to upset a calm client and get paid, than to not upset a client and not get paid. If you smell a rat in there somewhere, file a lein. 4 times I have had to do it, and 4 times I got paid for my work, even though it was the bonding company on the project that ended up sending me a check. One other thing I have noticed. General contractors who are close to pulling the plug, start taking longer and longer between your invoices and sending you a check. Also they get real demanding all of a sudden, and like to express how they expect "loyalty" and so forth from the subs. Whenever I hear that it is time to polish the shotgun.
Posted By: Tiger Re: Waiver of Lien - 09/16/05 06:03 PM
I wouldn't consider placing a lein on property until the account was well over 30 days, and would take a few earlier steps (letters, phone calls).

The downside of leins is that sometimes only the lawyer gets paid. A $1200 bad debt went bankrupt on me after 5 years. If the homeowner stays in the house you may have your lein for 30 years with nothing but the paper to show for it.

I'm just over 20 years in business for myself and have not collected $3,126.52, which averages $156.32 per year. It's such a small fraction of 1% of my business that I don't sweat it.

Dave
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