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Home>Levelset Community>Legal Help>I have submitted a bid to a customer who is receiving money from HUD. They are requesting a waiver of lien before they will release funds to customer. What waiver is required by HUD ?

I have submitted a bid to a customer who is receiving money from HUD. They are requesting a waiver of lien before they will release funds to customer. What waiver is required by HUD ?

TexasLien Waivers

HUD wants a waiver of lien before they will release funds

2 replies

Jun 5, 2018
As a general point, lien waivers are used sort of like receipts. When payments are made, lien waivers are exchanged for those payments. With this exchange, the party making payment can be sure that a lien claim will not be made for the payments that have been disbursed. Waivers are often requested before payments are made, and ultimately the timing of waivers exchanged may typically be negotiated between the parties. Anyway, if a waiver is submitted before payment is received a conditional waiver might appropriate. This type of waiver is conditioned upon the receipt of payment - if payment isn't received, lien rights aren't waived. When payment has been received, an unconditional waiver may be requested. An unconditional waiver will waive lien rights regardless of whether any payment has been made. Naturally, unconditional waivers can be risky. Beyond conditional and unconditional, waivers can also be partial (for progress payments) or final (used in exchange for final payment). Thus, there are 4 types of lien waivers: Partial Conditional, Partial Unconditional, Final Conditional, Final Unconditional. For a quick breakdown of each waiver type, try this post: What is a Lien Waiver? Finally, Texas is one of the few states where mechanics lien waivers must abide by specific statutory requirements. So, in order to be effective, any waiver exchanged should abide by the forms provided in the Texas Property Code. For more information on Texas lien waives, check out our Texas Lien Waiver FAQ. We also have free forms available, which can be found here after selecting "lien waivers" on the drop down menu.
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Feb 27, 2020
My home was destroyed by fire November 18, 2019 in Julian California. I have a reverse mortgage loan backed up by HUD, my mortgage company wants my contractor to sign a waiver of lean, my contractor is reluctant. Question should we sign a conditional waiver of lean question
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