Lien is mostly used in real estate property matters and it can be explained as pledging the property with the creditor as collateral or guaranty of the safe and full return of the borrowed money i.e. mortgage or loan. When a creditor puts lien on a property, he now owns the ownership rights of the property and he can either sell or lease the property to anyone in order to collect his debt.
When there is some kind of outstanding payment on a property i.e. tax returns or mortgage payments, the creditor has the legal right to take away the property from the owner and put a lien on the property. In order to inform the owner of the property about the lien on the property, lien certificate is issued to the owner. This lien certificate indicates towards the factors why there is lien on the property, who or which department has taken the property and what the owner can do in order to get the property back.
Introduction to the Waiver of Lien Certificate:
As we have described above that when there is some kind of outstanding dues or payments on a property, the creditor has the right to seize the property and put lien on it. The lien is put on the property by the lien certificate that indicates why there is lien on the property and how the owner can get the property back. When the owner of the property wants to pay the outstanding dues to the taxation department or to mortgage loan firm, he can then demand or request the department i.e. creditor to waive the lien certificate. As soon the lien certificate is waived by the creditor, the lien certificate terminates and becomes ineffective. At this point the owner of the property can now take the charge of his property back and use it or even sell or lease it if he wants.
Common types of Lien Waivers:
There are many types of lien waivers used these days but most of them are used for specific reasons where some of these types of waivers can be used for general purposes. Some of the general purpose lien waivers are explained below.
- Conditional waiver on progress payment:
This is the most effective and common used waiver for the lien certificate. This waiver indicates that the payment made by the owner of the property is in progress and although the claimant hasn’t received the payment, but there is also no problem in the process and it’s expected that the payment will be made to the creditor on time.
- Unconditional waiver on progress payment:
This waiver indicates that the claimant has in fact received the payments made by the owner of the property and now the claimant has no rights to put lien on the property.
- Conditional waiver on final payment:
This is the safest waiver for the owners of the real estate property as with this waiver, the property owners can prove that they have paid the creditor or claimant in full before expiration and now they deserve to own the property once again. This waiver makes all claimant rights on the property ineffective but with certain conditions and terms.
- Unconditional waiver on final payment:
This waiver is used when the claimant has in fact received the full payment in time before the expiration date and the payment is made by the owner of the property. This waiver makes all the claims on the property by the claimant ineffective immediately.
Here is preview of a Free Sample Waiver of Lien Certificate Template created as fill-able PDF Form,
Here is download link for this Waiver of Lien Certificate Template,