# customer wants lien waiver but can not pay in full



## contractorjay (Dec 22, 2009)

i have a customer who cant pay in full because "something came up". but now she wants a mechanics lien waiver and contractors affidavit. she said this is required by state of IL and her attorney stated this. i'm turning my file to our attorney but just wanted some insight on this subject.


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## Sir Mixalot (Jan 6, 2008)

:no: Pay in full or no Lien Waiver.

-Paul


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## Builderbob 72 (Dec 15, 2010)

You can issue a partial lien waiver that encompasses what the client has paid to date, but there is no requirement to issue a final waiver until payment has cleared the bank. If the client is flaky, I would demand final payment in the form of cash or cashier's check. And then issue the waiver only when the money is in the bank.

Sounds like they're trying to sell/refinance and need a clear title. I would post a Notice to Owner ASAP


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## VinylHanger (Jul 14, 2011)

I wonder if she would have went ahead and paid you in full and then signed off that the job is done before you started? Probably not. No pay, no waiver.

You could tell her you didn't just get off the turnip truck. It's been at least three weeks since you picked turnips and you've learned a thing or two. :laughing:


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## carolinahandyma (Jan 6, 2006)

How much does she still owe you? Can she work out a payment plan to pay the balance over time?

I would try and appear flexible so that she pays what is due but wouldn't give her a release until her balance was zero.


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## contractorjay (Dec 22, 2009)

carolinahandyma said:


> How much does she still owe you? Can she work out a payment plan to pay the balance over time?
> 
> I would try and appear flexible so that she pays what is due but wouldn't give her a release until her balance was zero.



usually when homeowners say they cant pay, what they really meant is they cant pay.

we're not going to try to act as a bank. imagine if all our homeowners decide to do a payment plan.


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## rock16 (Feb 25, 2010)

Builderbob 72;1296784[B said:


> ]You can issue a partial lien waiver[/B] that encompasses what the client has paid to date, but there is no requirement to issue a final waiver until payment has cleared the bank. If the client is flaky, I would demand final payment in the form of cash or cashier's check. And then issue the waiver only when the money is in the bank.
> 
> Sounds like they're trying to sell/refinance and need a clear title. I would post a Notice to Owner ASAP


This is exactly the right way to handle it. We issue a partial lien waiver with each progress payment. You are going to hose yourself if you issue a final unconditional waiver.


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## contractorjay (Dec 22, 2009)

ok, i didnt want to admit it but homeowner didnt pay a dime yet. someone in our office fluked and allowed the job to start without down payment. they were suppose to get 1/3 by mail but job end up starting before.

they dont owe a huge sum, just $6,800. 

im reading the lien laws in IL but no where does it states we require to release anything (swon statement, lien waiver, etc)
http://nationallienlaw.com/Forms.asp?StateID=14


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## AlbacoreShuffle (Aug 26, 2011)

Not only would i NOT give her a lien release. 
I would be down to city hall filling a mechanics lien ASAP !


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## contractorjay (Dec 22, 2009)

AlbacoreShuffle said:


> Not only would i NOT give her a lien release.
> I would be down to city hall filling a mechanics lien ASAP !


exactly what i figured.


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## AlbacoreShuffle (Aug 26, 2011)

contractorjay said:


> exactly what i figured.


Don't drag your feet, she may be trying to sell the property , or try and do a "quick deed " to get around the lien.
Act fast !


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## PSG (Oct 16, 2010)

She is partially correct. You are required to give her a Contractors affidavit which lists all subs and material suppliers you used. You do not have to give a final Lien waver untill you are paid.


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## carolinahandyma (Jan 6, 2006)

contractorjay said:


> ok, i didnt want to admit it but homeowner didnt pay a dime yet. someone in our office fluked and allowed the job to start without down payment. they were suppose to get 1/3 by mail but job end up starting before.
> 
> they dont owe a huge sum, just $6,800.
> 
> ...



File a lien immediately and I would file suit for breech of contract in small claims court as well.


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## contractorjay (Dec 22, 2009)

AlbacoreShuffle said:


> Don't drag your feet, she may be trying to sell the property , or try and do a "quick deed " to get around the lean.
> Act fast !


yes sir!


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## contractorjay (Dec 22, 2009)

PSG said:


> She is partially correct. You are required to give her a Contractors affidavit which lists all subs and material suppliers you used. You do not have to give a final Lien waver untill you are paid.


i did not provide an affadavit. i did provide her the name and address of ABC supply.

we did not sub out on this job so we dont have a list to provide on this.


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## PSG (Oct 16, 2010)

contractorjay said:


> i did not provide an affadavit. i did provide her the name and address of ABC supply.
> 
> we did not sub out on this job so we dont have a list to provide on this.


You should be able to download the affidavit. I would put that info on the form and give it to her. That would got rid of her excuse for not paying.


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## contractorjay (Dec 22, 2009)

PSG said:


> You should be able to download the affidavit. I would put that info on the form and give it to her. That would got rid of her excuse for not paying.


the only affidavit i found was this one http://www.peoriaparks-planning.org/forms/affidavit.pdf. it looks a lot like a lien waiver to me.


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## BamBamm5144 (Jul 12, 2008)

As others suggested, make sure to get her notice of lien right away.

Is this project already complete? If so, invoice her the full amount and send that along with the notice of lien. If there are ANY issues, I suggest you do it over email so it is all recorded and/or just turn everything over to your attorney and in no way have any communications with her.


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## Builderbob 72 (Dec 15, 2010)

If she's paid zero to date...there's nothing to waive, only invoice! But for future reference:

http://illinois.ctic.com/files/forms/WaiverofLien.pdf

Obviously you've shut down any work and fired the office staff...right?

Some other forms on this site for Illinois (Is it Ill i NOI or Ill i NOISE) 

http://illinois.ctic.com/forms.aspx


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## contractorjay (Dec 22, 2009)

Builderbob 72 said:


> If she's paid zero to date...there's nothing to waive, only invoice! But for future reference:
> 
> http://illinois.ctic.com/files/forms/WaiverofLien.pdf
> 
> Obviously you've shut down any work and fired to office staff...right?


i think we all have a down day once in a while. our office people are pretty good. hopefully this wont happen again.


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## Beanfacekilla (May 19, 2011)

So let me get this straight...

She hasn't paid anything, but she wants a full unconditional waiver. Hmmmm.

I would demand payment, and start the lien process immediately. 

Whatever you do, don't give her a waiver. 

I think customer is DELIBERATELY trying to screw you over. She wants a waiver so she can stiff you on the money. 

Pretty much everyone said something similar to what I just said. I agree with the other members who said to "act fast". 

I can't even believe she has the nerve to ask for a full unconditional waiver, to spite the fact she hasn't paid ANYTHING. The nerve of some people...

Just my $0.02, tell her if you don't get money quickly (perhaps 24 hours), you are going to lien her property. Don't be a nice guy. Get paid.

Just my opinion. Peace.


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## rselectric1 (Sep 20, 2009)

Jay, 

When was the last day you actually worked on the property? If it is over 60 days ago, you may be out of luck on the mechanics lien.

In an owner occupied residence, you must serve an "intent to lien" notice within 60 days of your last work on the home. (Illinois)

Hopefully it's a freshly completed job, but there IS a clock ticking.


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## scraigc (Aug 2, 2010)

Follow your state's lien law requirements, get the appropriate notices filed promptly, and only sign a partial release of lien, for the amount paid.

the sooner the better :blink:


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## larryb (May 23, 2008)

If you've followed required protocols, file the lien immediately. Sounds like this HO is trying to scam you. Sounds like she's also trying to mislead her attorney by giving incomplete information (like, oh yeah, I forgot to tell you that I didn't intend to pay the contractor), or, the attorney knows what she's up to and is giving her bad advice. But, that's not your primary concern. 

Obviously, as you know and as most on this form have stated, it's about you getting paid and protecting your interests. 

Make sure your guys did good work on the house so that when you take possession of it, you can sell it quickly! 

Salesman's commission = $0


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## moorewarner (May 29, 2009)

Like everyone else has said, you need to put aside her desire for a waiver and pay attention to getting paid.

If your contract spelled out down payment and/or draws and she has paid nothing, and she is focusing on waivers and not that she has paid nothing to date, she sounds fishy as hell.

+1 to this whole thread's worth of responses.


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## erickMcg (Oct 5, 2011)

A lien waiver states that you waive your right to put a lien against the property for payment due. If she has not paid you anything, waiving your right to place a lien is giving away the job 

No waiver. Yes invoice. Yes notice to file lien then file it promptly before your time window closes. When paid in full, give full waiver. If paid partially, give partial waiver.

Her 'attorney' is full of doodoo. You don't 'need' to give her anything except a bill at this point.

What did your contract state as payment terms?

-


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## Splinter hands (Aug 31, 2011)

No waiver No way. Like everyone else has said I think she is trying to stiff you. Good Luck.


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## Fallen (Feb 25, 2009)

Your taking the right path in speaking with your attorney. You don't have to give the H/O a waiver, unless of course she's offering to exchange a check for it, (preferably certified funds). Your lawyer will walk you thru the process. Bear in mind that each states lien laws vary. From what you said you have a direct (or "Original") Contract with the homeowner. If that is the case you do not have to serve the H/O with a 90 day notice. You *do* want to do your best to have the lien recorded within four (4) months from your last day of substantial work / completion.

You can't rule out that the H/O is wanting to sell the house or refinance, so you want to get the lien on record asap. It's all about leverage.


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## TheItalian204 (Jun 1, 2011)

Call 1-800-Choke-that-H*e


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## TheItalian204 (Jun 1, 2011)

Splinter hands said:


> No waiver No way. Like everyone else has said I think she is trying to stiff you. Good Luck.


She already stiffed him,now she is trying to get away with it.


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## skyhook (Mar 17, 2007)

contractorjay said:


> i have a customer who cant pay in full because "something came up". but now she wants a mechanics lien waiver and contractors affidavit. she said this is required by state of IL and her attorney stated this. i'm turning my file to our attorney but just wanted some insight on this subject.


This one gets my hackles up. Does she pay her atty? Does she pay her grocery bill? 
There are only 2 types of Contractors. Those who have been stiffed, and those who will get stiffed. 
Man up, get your money or get walked on.


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## Leo G (May 12, 2005)

Of course she wants it. Tell her "Right here"


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## garagebuilders (Oct 10, 2011)

*I agree - but be kind and respectful*



Builderbob 72 said:


> You can issue a partial lien waiver that encompasses what the client has paid to date, but there is no requirement to issue a final waiver until payment has cleared the bank. If the client is flaky, I would demand final payment in the form of cash or cashier's check. And then issue the waiver only when the money is in the bank.
> 
> Sounds like they're trying to sell/refinance and need a clear title. I would post a Notice to Owner ASAP


I'm a Chicago garage builder myself and I understand how collections can go. I am very strict on payments. 

I would definitely be cooperative and give a partial lien waiver. Always hold something in check until you are paid in full and always collect professionally, respectfully, and persistently. It always pays off to treat everyone with respect, you never really know what "came up" and its a good idea to treat them the way you want to be treated when you are down on your luck.


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## Leo G (May 12, 2005)

How can you give a partial lien waiver when no payments have been made? And why would you?


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## skyhook (Mar 17, 2007)

.......................


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## skyhook (Mar 17, 2007)

Fallen said:


> From what you said you have a direct (or "Original") Contract with the homeowner. If that is the case you do not have to serve the H/O with a 90 day notice.


Provided that notice is in the signed contract.


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## scraigc (Aug 2, 2010)

garagebuilders said:


> I'm a Chicago garage builder myself and I understand how collections can go. I am very strict on payments.
> 
> I would definitely be cooperative and give a partial lien waiver. Always hold something in check until you are paid in full and always collect professionally, respectfully, and persistently. It always pays off to treat everyone with respect, you never really know what "came up" and its a good idea to treat them the way you want to be treated when you are down on your luck.


Great tips, don't need to burn any bridges. The HO may be trying to not pay, but may also be misinformed by a family member. Try to treat people the way you want to be treated or the way you want your parents treated


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## AustinDB (Sep 11, 2006)

Leo G said:


> How can you give a partial lien waiver when no payments have been made? And why would you?


'conditional lien release'...the large company I perform work for uses this for draws over $5000 and the wording includes "but only to the extent of payment received, as indicated and limited below:" then it further describes the conditional release.


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## MannyH (Oct 11, 2011)

On a typical FINAL ROL you can include language stating the lien release is conditional on actual receipt of payment. Until you receive the payment, they are not released.


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## contractorjay (Dec 22, 2009)

thanks for all the input, we finally got the lady to make payments. she's paid 75% so far. for future reference, where do i find the 60 day and 90 day notice to lien form?


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