Encumbrance

An encumbrance refers to any sort of limitations or restrictions on a property (such as mortgages or zoning restrictions) that affect what can be done with it.

What is an encumbrance? 

An encumbrance refers to any sort of limitations or restrictions on a property (such as mortgages or zoning restrictions) that affect what can be done with it. This can pertain to things such as how the property is used and its transfer of ownership. 

How exactly can an encumbrance pose limitations? 

An encumbrance such as a mortgage could have implications on whether you could undertake home improvements/renovation. Lenders may deny a loan for this to reduce the risk of default on additional debt. 

How can you find encumbrances on a property? 

A Land Title search of the Title Deed can reveal whether there is an encumbrance such as registered mortgage. If a mortgage is found, it indicates that the bank or another financial institution holding the mortgage has possession of the Title Deed. 

How long does an encumbrance last? 

The duration of an encumbrance on a property varies depending on the type. For instance, a mortgage encumbrance typically lasts until the home loan is fully paid off. 

Liens, which are claims against the property due to unpaid debts, last until the debt is resolved. 

Easements, granting someone the right to use part of the property, can be either temporary or permanent, depending on the agreement. In simple terms, the duration of an encumbrance is tied to the specific conditions outlined in the agreement or the resolution of the underlying circumstances.

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