Common use of Claims for Labor and Materials Clause in Contracts

Claims for Labor and Materials. Borrower will promptly pay and discharge all claims and liens for labor done and materials and services furnished in connection with the construction of each Home. Borrower will have the right to contest in good faith any claim or lien, provided that it does so diligently and without prejudice to Lender. Upon Lender’s request, Borrower will promptly provide a bond, cash deposit or other security reasonably satisfactory to Lender to protect Lender’s interest and security should the contest be unsuccessful. At Lender’s request, Borrower will provide to Lender proof of payment of the costs of labor, material and services supplied for each Home. Borrower will disburse each Advance to pay the costs and expenses incurred in the construction of each Home through the stage of construction for which the Advance is made. Borrower authorizes Lender to contact any supplier of labor, material and services to verify payment of the amounts due for each Home and authorizes any such supplier of labor, material or services to provide to Lender information requested by Lender regarding payment of amounts due from Borrower.