Encumbrance Legal Meaning and Definition

Here is a simplified definition of the legal term Encumbrance.

Encumbrance (noun): A term used to describe any legal claim, lien, or obligation attached to a piece of real property or assets. Encumbrances can include mortgages, deeds of trust, unpaid property taxes, tax liens, mechanic's liens, easements, and rights to resources like water or timber. These typically need to be cleared or paid off before the property can be sold or transferred. Encumbrances are usually recorded with a local official, such as the Recorder of Deeds, and remain attached to the property even if ownership changes.