Encumbrances are claims or liabilities against pieces of real estate that affect the value of and the title of the property. There are many types of real estate encumbrances, and some of the most common are property liens, deed restrictions, easements, and encroachments.
Liens are a common type of real estate encumbrance. To put it simply, a lien is a monetary claim against a commercial or residential property to secure an obligation or debt from the owner. A well-known type of lien is for unpaid taxes, known as a tax lien. Even though they seem like a more positive type of debt to have, mortgages are actually liens against a property.
Deed restrictions are sometimes known as conditions or covenants, and they are another common type of real estate encumbrance that is written into (you guessed it!) the deed. Deed restrictions place limits on how a commercial or residential property can be used or on what types of structures can be built on an unoccupied property. When a new subdivision or portion of land is developed, many times the builders or developers will place various deed conditions on portions of the property to ensure that the property is used only for certain purposes. Deed restrictions can be helpful when trying to ensure value and construction standards within an area of land.
Easements are another common type of real estate encumbrance. The legal right to utilize a property without owning it is an easement. One example of this is when the power company installs or repairs power lines on property technically belonging to a homeowner. Other times, an easement is simply the right of someone other than the technical property owner to walk on the land for another purpose (for example, to use a shared driveway belonging to one property owner to approach your property).
Encroachments occur when buildings technically overlap due to property lines or surveyed boundaries. They are almost always an accident and discovered during the process of buying or selling a property. Depending on the type of property, location, and severity of the encroachment, the one who is doing the encroaching could have to do anything from paying a fine to removing the encroachment (even if that means a portion of the building).
A Title Company You Can Trust: Colony Title
At Colony Title, we will help you through the process of getting your property’s title and help you avoid the pitfalls of hidden costs while you buy your home. We are also well trained in identifying any and all errors in public records and helping you resolve them. We specialize in real estate title insurance in both Maryland and Washington, D.C., and we will perform an expert title search, check through all past documentation, and examine records for any fraud or forgery. For more information on how we can get you into the home of your dreams, contact us online or give us a call at (410) 884-1160. To get more updates on housing markets and how to get into your home, follow us on Facebook, Twitter, LinkedIn, and Google+.