Question

Doonesbury is interested in the purchase of a 30 acre farm in Abbotsford. Prior to making an offer on the property Doonesbury obtained a title search from the New Westminster Land Title Office. Discuss the various encumbrances that may show on the title to the property and advise Doonesbury of the possible relevance of each encumbrance to him as a purchaser. *Each relevant point is worth 2 mark. A point is gained for listing the encumbrance and a point is gained for describing it.

Answer 1

Encumbrance

An encumbrance is a claim against a property by a party that is not the owner. An encumbrance can impact the transferability of the prop[erty and restrict its free use until the encumbrance is lifted. The most common types of encumbrance apply to real estate; these include mortgages,easements, and property tax liens.But in some cases not all forms of encumbrance are financial, easements being an example of non financial encumbrance.

TYPES ENCUMBRANCE WHICH ARE MOSTLY CONCERNED

1. Liens
2. Deed restriction
3. Licenses
4. Encroachments
5. Easements

1.Liens

A lien is a restriction place don the property based on unpaid finances. Liens are created to incentives property owners to repay money owned to another party. In the words, a property would be given a lien when the owners have not paid off a debt.Unpaid mortgages, taxes, or money owed from a Contract services are examples of liens. If a person have not made a mortgage payment then the property would be given a lien.

2.Deed restriction

Deed restriction are agreed upon rules that the homeowner must follow to own a property. Those restrictions are feasible in every matter of situation. However, some common examples include where homeowners can park their vehicles or whether they can perform construction projects. Deed restriction create a standardized use of the property in a specific area. Although, some properties should follow string and norms in order for property owners to occupy the space. Mainly this is to preserve the property value of the land.

3.Licenses

Licenses is a verbal or written permission to have access to the property owners land. Its a mutual agreement between two parties. For instance, a homeowner may give permission to their neighbor to store their personal items in their garage or on their property. Additionally, a license can be revoked at any time. The owner, granting permission, can withdraw their offer whenever they feel it is necessary to do so.

4.Enroachments

Encroachments is related to the property borders bet ween two neighbors. When a tree branch is handing over the property line, this is considered an encroachment. Often times, homeowners will install fences as a mean to specify the property border between two adjacent lands.

5.Easements

An easement allows third parties to use a property without ownership. This grants a party, unrelated to the owners, access to the property. A common example of an easement is when a utility company will need access to the land for an installation project. As a result, they will have a right of way to access the property to fulfill the project requirements.