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Can the homeowner party to a residential construction contract legally waive the requirement to hold back 10% statutory

8 months ago

Can the homeowner party to a private residential construction contract legally waive the requirement to hold back 10% statutory retainage requirement?

Senior Legal Associate Levelset
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Nothing in the Texas Property Code’s provisions on retainage seem to allow an owner to contract out of the retainage requirements created at § 53-101. Note, though, that an owner can technically refuse to follow retainage requirements – it will just open them up to greater liability on the job – and the Texas Property Code actually plans for that possibility.

Under § 53-105(a), an owner who fails or refuses to withhold the statutory 10% retainage will be subject to mechanics liens at least to the extent that they failed to retain funds. Otherwise, a subcontractor’s lien claim would be limited to a greater degree.

For futher discussion on Texas’ retainage laws: Texas Retainage Guide and FAQs.

Disclaimer: The information presented here is not legal advice and should not be construed as such. Rather, this content is provided for informational purposes. Do not act on this information as if it is advice. Further, this post does not create any attorney-client relationship. If you do need legal advice, seek the help of a local attorney.
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