Liens: These are legal claims against a property that secure payment of a debt. Examples include:
* Mortgage lien: A claim on the property to secure payment of a loan.
* Tax lien: A claim on the property to secure payment of unpaid taxes.
* Mechanic's lien: A claim on the property to secure payment for work done on the property.
Easements: These are rights granted to another party to use a portion of your property for a specific purpose. Examples include:
* Utility easement: Allows a utility company to access and maintain lines on your property.
* Access easement: Allows someone to access their property through yours.
Restrictive covenants: These are rules or limitations placed on the use of the property, often found in a homeowner's association (HOA). Examples include:
* Building restrictions: Limits on the size or style of buildings allowed on the property.
* Use restrictions: Prohibitions on certain types of activities, such as businesses or pets.
Other Encumbrances:
* Encroachments: Structures or features that extend onto a neighboring property without permission.
* Judgments: Legal rulings that can be enforced by placing a claim on the property.
* Leases: Agreements that grant someone the right to occupy and use the property for a specific period.
Importance of Knowing Incumbrances:
Understanding incumbrances is crucial for anyone buying, selling, or financing a property. They can:
* Affect the value of the property: Incumbrances can make a property less desirable to buyers.
* Impact the ability to obtain financing: Lenders may be hesitant to finance a property with significant incumbrances.
* Create legal complications: Incumbrances can lead to disputes or legal action if not properly disclosed or addressed.
Disclosure:
Sellers are typically required to disclose known incumbrances to potential buyers. It's important for buyers to be aware of all incumbrances before making an offer.