Mechanic's lien laws let unpaid contractors and suppliers place a claim on the property they improved. Owners and lenders therefore ask for lien waivers with each payment. A conditional waiver takes effect only when the stated payment actually clears, while an unconditional waiver takes effect immediately, which is why it should only be signed after funds are received.
Waivers also differ between progress payments and final payment. Several states prescribe the exact form that must be used. Contractors handle large numbers of waivers across jobs, so tracking which have been sent, signed, and returned, and never sending an unconditional waiver early, is an important office control.