Closings glossary
Encumbrance
Any interest in the property held by someone other than the owner, whether monetary such as a mortgage or lien, or non-monetary such as an easement or a covenant.
What is an encumbrance on property?
Quick Answer
The full definition
Any interest in the property held by someone other than the owner, whether monetary such as a mortgage or lien, or non-monetary such as an easement or a covenant.
Where does encumbrance come up in a New York City closing?
A Brooklyn brownstone carries a mortgage, a sidewalk easement and a party wall agreement, and only the mortgage is paid off at the closing table.
What else should you read before closing?
In the glossary
- LienA claim against property securing payment of a debt. Liens rank by priority, and closing normally means paying or releasing every one ahead of the ...
- EasementA right to use part of another owner's property for a specific purpose. Easements appear as exceptions on a title report and generally survive a sa...
- CovenantA recorded promise or restriction that runs with the land and binds future owners. Restrictive covenants limit what the property may be used for or...
- Title exceptionA matter the title policy does not insure against, listed on Schedule B. Some exceptions are removed before closing and others are simply accepted ...
- Marketable titleTitle a reasonable buyer would accept, free of defects that would expose that buyer to litigation. Most New York contracts require the seller to co...
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