Liens and Releases Issues

When the project developer makes periodic payments to contractors, the developer should obtain a lien release from each contractor and major subcontractor.  A lien release will help protect the project developer from liens being filed on the project by subcontractors who have not been paid.  Liens are undesirable because (among other reasons) once filed, they can delay or interfere with the project’s financing or sale.  Worse still, if a lien claimant is successful, a lien could be used to force a foreclosure sale of the project property.

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