Encumbrance

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Real Estate Terms Glossary

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

Here’s Investopedia’s definition of an Encumbrance .

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