Encumbrance

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What is an Encumbrance?

Real estate has an encumbrance, such as a lien, if someone other than the owner of the property can make a claim regarding its use. Note that an encumbrance on real estate can be a financial, legal, or personal responsibility inhibiting the transfer or use of a property. Did you know that encumbrances include deed restrictions, liens, easements, and encroachments?

An encumbrance can prevent the owner from enjoying the full rights of property ownership and can even lessen their property’s value.

Examples of Encumbrance

  • Example 1: Property easements
  • Example 2: Deed restrictions

Here’s Investopedia’s definition of an Encumbrance .

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ContractsCounsel is not a law firm, and this post should not be considered and does not contain legal advice. To ensure the information and advice in this post are correct, sufficient, and appropriate for your situation, please consult a licensed attorney. Also, using or accessing ContractsCounsel's site does not create an attorney-client relationship between you and ContractsCounsel.


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