Savvy Buyers making an offer on a newly remodeled home want to make sure they’re not inheriting a liability from their Seller.
Specifically, they’ll want evidence that the Seller has paid all their contractors in full.
The evidence? A legal release — called a “lien waiver” — that the contractors execute once they’ve been paid.
And if a contractor hasn’t signed a lien waiver?
They have the right to ultimately put a lien (legal claim) on the property for the amount that they’re owed.
180 Day Window
At least in Minnesota, the issue of lien waivers seldom arises, for two reasons:
One. The vast majority of homeowners pay their contractors in full once work is complete.
Two. Minnesota contractors have a limited window — specifically, 180 days — to file a lien waiver.
Practically, that means if the remodeling works was completed more six months ago, unpaid contractors have effectively waived their right to place a lien on the home.
Voila! Unless the remodel is of recent vintage, prospective home buyers (and their agents!) can relax . . .
