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$0 lien waiver/upside-down payment

CaliforniaLien Waivers

I am getting a customer right now who is requesting a $0 waiver for a UF for which they have not paid anything yet. We returned the waiver with the payment amount $5,000.00 (example). They returned it to us and said the payment amount needed to be $0 in order for the bank to approve it, and that puting $5K in the payment amount made the waiver "upside-down". Is it still advisable to not grant a $0 lien waiver in this case?

1 reply

May 24, 2023

If you have not received payment for labor and materials furnished, I would not sign an unconditional final waiver indicating that no amount is owed. And I would be very suspicious of a construction lender or customer demanding that you release your lien rights before receiving payment. Did the customer or bank provide any valid basis for the request?

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