Latest Articles

Misc

March 15, 2019

Encumbrance


Word of the day

Encumbrance

Any claim, lien, charge, or liability attached to and binding on real property that may lessen its value or burden, obstruct, or impair the use of a property but not necessarily prevent transfer of title; a right or interest in a property held by one who is not the legal owner of the property. Also spelled incumbrance. 

There are two general classifications of encumbrances: those that affect the title, such as judgments, mortgages, mechanics’ liens, and other liens, which are charges on property used to secure a debt or obligation; and those that affect the physical condition of the property, such as restrictions, encroachments, and easements. 

A covenant against encumbrances guarantees that there are no encumbrances against the property except those specifically disclosed. If no encumbrances are disclosed as exceptions in the contract of sale, the buyer may proceed with the purchase on the assumption that none exist. Encumbrances should be noted on the deed following the property description.

Related Post

Industry, Residential Real Estate, Education

Library of Real Estate Clauses

December 16, 2018

Brokerage, Technology, Consumer News, Residential Real Estate, Education, Misc

Short Sales and Tips for Newly Licensed Real Estate Agents

December 5, 2018

Brokerage, Consumer News, Residential Real Estate, Misc

Unilateral Contract VS Bilateral Contract

November 23, 2018

2019 Real Town The Real Estate Network