What is the difference between conditional and unconditional lien waivers?

A conditional lien waiver takes effect only after payment clears the bank, whereas an unconditional waiver releases lien rights immediately upon signing, regardless of whether funds have cleared.

How is retainage calculated on commercial construction progress billings?

Standard commercial contracts hold 10% retainage on labor and materials until 50% project completion, after which retainage is frequently reduced to 5% until final closeout and punch list sign-off.

Commercial Construction Accounting

Construction Retainage & Pay App Engine

Calculate monthly progress billing amounts, withheld retainage escrow, conditional lien release requirements, and final retention cash payout.

Contract & Progress Billing

Total Subcontract / Prime Contract Value ($)

Retainage Percentage (%)

Current Work Complete (%)

Previously Billed to Date ($)

Stored Materials on Site ($)

Pay Application Summary

Current Payment Due $24,750 Net Check to Sub

Withheld Retainage $2,750 Current Period Escrow

Cumulative Retainage $6,750 Total Held in Escrow

Gross Earned $75,000 Work + Materials

Balance to Finish $75,000 Remaining Contract

Required Waiver Conditional Progress Prior to payment

Final Retention Release Timing: Upon Substantial Completion & Punch List

Statutory Retainage Cap: Often limited to 50% project milestone

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