Updated August 04, 2023
An Unconditional Mechanic’s Lien Release is a legal document that should be considered a satisfied lien inasmuch as this specific type of release places no restrictions upon on the discharge of the owner’s property. Generally, this particular form would indicate that any legal financial instrument that has been used to complete payment for a release has cleared the institution. It may also mean that suitable arrangements have been made to clear the debt owed and that the holder of the lien requires no other steps to be completed, documentation or payment to be received in order for the lien to be considered a cleared lien.
Understanding an Unconditional Mechanic’s Lien Release
An Unconditional Mechanic’s Lien Waiver and Release occurs when the claimant has in fact received a progress payment from an individual or financial institution, which is not inclusive of the final payment. Exceptions may be associated with Conditional and Unconditional Waiver and Release and should be reviewed. The Unconditional Mechanic’s Lien Release goes into effect and is enforceable immediately upon being signed by the appropriate parties. The Unconditional Mechanic’s Lien Release should be compliant with local state regulations as they vary for each state.
Cautions to Take
Because the contractor, subcontractor and material supplier waives all rights of filing a lien on the project and the consequences for signing an Unconditional Mechanic’s Lien Release could be dire, below are cautions to take:
- Consult legal counsel prior to signing the Unconditional Mechanic’s Lien Release to ensure the document is accurate, as it is a legally binding document.
- Ensure that the money has cleared your financial institution. Signing a waiver prior to a check being fully funded could result in a check being returned for insufficient funds which leaves the contractor, subcontractor or material supplier with no payment and no lien rights.
- Ensure that the full payment amount has been received as outlined in the document. The contractor, subcontractor or material supplier should confirm the payment received matches the exact amount that is stated for progress payment.
- The date on the Unconditional Mechanic’s Lien Release should reflect the rights for work performed through a specific time. The dates the payment was or will be received by should match the dates in the waiver.
- If the direct contractor is based out of a different state then where the work is being completed, the Unconditional Mechanic’s Release must follow the local state laws of where the job-site is located.
Who Should Sign?
The Unconditional Mechanic’s Lien Release should be signed by the direct contractor, subcontractor and material suppliers, if applicable, to reduce financial liability. Due to all project parties being identified on the document, they are all waiving the right to file lien in the future. Dependent on the contract requirements a subcontractor may request another subcontractor or material supplier to sign the Unconditional Mechanic’s Release when that subcontractor has give payment.