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Encumbrance

Encumbrance is a claim against a property by a party that is not the owner of the property.

An encumbrance can impact the transferability of the property and restrict its free use until the encumbrance is fulfilled.

The most common types of encumbrance apply to real estate include mortgages, easements, and property tax liens.

Not all forms of encumbrance are financial, easements being an example of non-financial encumbrances.

An encumbrance can also apply to personal property ( as opposed to real estate).

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