Lien Release Explained for Washington Homeowners

Short Answer: Unpaid contractors, subcontractors and suppliers can claim a lien on your property under RCW 60.04. A lien release is a signed statement that a party has been paid and gives up its lien rights, so collect one each time you pay.

Quick Facts

A construction lien lets someone who improved your property and was not paid claim an interest in it. In Washington, that includes not just your contractor but its subcontractors and suppliers. The surprise for many homeowners is that a lien can arise even after you paid your contractor in full. Lien releases are how you prevent paying twice. This is general information, not legal advice.

How Construction Liens Work

Under RCW chapter 60.04, people who furnish labor, professional services, materials or equipment to improve real property have a right to a lien for the contract price. That can include:

• your general contractor,
• subcontractors hired by your contractor,
• material suppliers and equipment rental companies,
• workers.

If your contractor collects your payment but does not pay its supplier, the supplier may claim a lien against your property.

The Notice to Owner

Many subcontractors and suppliers who did not contract directly with you send a Notice to Owner under RCW 60.04.031. The statutory notice warns, in capital letters, “PROTECT YOURSELF FROM PAYING TWICE” and explains that you can ask for lien releases and use joint checks.

Important details:

• For repair or remodel of an existing owner-occupied single-family residence, parties who contract directly with you do not need to send notice.
• If a subcontractor or supplier who must send a notice does not, its lien may be limited, and its lien on your property is generally limited to amounts you have not yet paid your contractor when you receive the notice.

Keep every Notice to Owner. Each one is a party whose lien release you should collect.

Lien Deadlines

If no lawsuit is filed in time, the lien expires.

What Is a Lien Release?

A lien release (sometimes called a lien waiver) is a written statement signed by a contractor, subcontractor or supplier confirming it has been paid, wholly or partly, and releasing its right to claim a lien for that amount.

Partial Releases

Cover payments made so far. Collect them with each progress payment.

Final Releases

Cover the whole job. Collect them before the final payment and retainage.

How to Collect Releases

1. Ask for a list of subcontractors and suppliers at the start; write the requirement into your contract, as in the Home Improvement Contract Checklist for Washington.
2. Match releases to Notices to Owner you receive.
3. Request releases with each progress payment.
4. Hold retainage until final releases are in.
5. Keep originals with your project file.

Joint Checks

For large material purchases, you can pay with a check made out jointly to the contractor and the supplier. Both must endorse it, so the supplier knows it has been paid. The statutory notice mentions joint checks as a protection.

Tip: The Notice to Customer required under RCW 18.27.114 also reminds you that you may withhold retainage and request lien release documents. Both are easier to arrange before work starts.

If a Lien Is Filed

• Do not ignore it. Read it and note the recording date and amount.
• Ask your contractor to resolve it, since the claimant was usually its subcontractor or supplier.
• Check the deadlines; a lien that is not foreclosed in time expires.
• Consider whether the claimant gave required notices.
• Get legal advice; lien law has many technical rules, and the owner may have defences and options to release the lien by bond.

The claimant may also have a claim against the contractor’s bond. See How to File a Claim Against a Contractor Bond in Washington.

When Liens Are More Likely

• The contractor is in financial trouble or its registration lapses mid-job.
• Materials are bought on account.
• Payments to the contractor run ahead of completed work.
• There are many subcontractors.

Monitoring the contractor’s registration status, bond and insurance helps you spot trouble early.

Selling or Refinancing

A recorded lien shows up in title searches. Clearing liens before closing is usually required. Collecting releases during the job avoids last-minute problems.

A Worked Example: One Notice to Owner

A homeowner hires a general contractor for a $60,000 addition. Two weeks in, a letter arrives from a lumber supplier: a Notice to Owner saying it is supplying materials to the project.

The homeowner adds the supplier to a simple tracking sheet. With the next progress payment, the homeowner asks the contractor for a partial lien release from the lumber supplier covering materials delivered so far. For the large framing package, the homeowner pays with a joint check to the contractor and the supplier. Before the final payment, the homeowner collects final lien releases from the supplier and the two subcontractors who also sent notices, then releases the retainage.

When the house is refinanced a year later, the title search is clean.

A Simple Lien Tracking Sheet

Keep the sheet with your contract and update it each time you make a payment.

Common Mistakes

Homeowners most often run into lien trouble by throwing away Notices to Owner, paying ahead of completed work, releasing retainage before final releases arrive, or accepting a release from the contractor that does not cover subcontractors and suppliers. Read each release to see who signed it, what amount and dates it covers, and whether it is partial or final. If a release looks incomplete, ask for a corrected one before the next payment.

Bottom Line

In Washington, paying your contractor does not automatically protect you from its unpaid subcontractors and suppliers. Track every Notice to Owner, collect partial and final lien releases, use joint checks for big material orders and keep retainage until the paperwork is complete.

Where to Go Next

Before you hire, run the business through the Washington Contractor Disclosure Statement (Notice to Customer).