Real Estate Principles Ch.5 - Encumbrances

CC&Rs

Covenants, conditions, and restrictions; limitations on land use imposed by deed, usually when land is subdivided, as a means of regulation building construction, density and use for the benefit of other property owners; may be referred to simply as restrictions.

Specific Lien

Creditor's right in identified property of the debtor.

Starting Time

Date on which a construction project begins (work starts or materials are provided).

Trustee's Deed

Deed given to the purchaser at foreclosure sale by the trustee acting under a deed of trust

Equity

Difference between current market value and the remaining indebtedness on a property; free-and-clear property value.

Satisfaction

Discharge of an obligation before the end of its term by payment of the total debt owed.

Abstract of Judgement

Document stipulating the outcome of a legal action, which can be filed in any country where the judgement debtor has property.

Voluntary Lien

Encumbrance on property imposed on action or with consent of property owner; a mortgage or deed of trust is a voluntary lien on the property identified in the security instrument.

Lien Release

Filed by holder of mechanic's lien to voluntarily remove the encumbrance from the property owner's title.

Lien Release Bond

Filed the the county recorder by property owner who disputes the correctness or validity of a mechanic's lien to stop foreclosure of the property; must be in an amount equal to 150% of either the entire claim against the property or the portion of the claim allocated to the parcel(s) sought to be released; can also be filed by anyone having an interest in the property or by another lien holder affected by the claim.

Involuntary Lien

Lien on a property that can be imposed without the express permission of the property owner; tax liens are involuntary liens.

General Lien

Lien on all property of the debtor.

Preliminary Notice

Notice of the right of a contractor, subcontractor, or material supplier to file a mechanic's lien; should be made within 20 days of the date on which the work begins or the material is provided.

Notice of Cessation

Notice that can be filed by a property owner after work on a construction project has been stopped for 30 continuous days.

Notice of Nonresponsibility

Notice that can be filed by a property owner and posted in a conspicuous place on the property within ten days of learning of construction, repair, or other work being performed on the property that the owner has not authorized.

Notice of Completion

Notice that can be filed by a property owner with ten days following completion of a construction project.

Priority of Claims

Order in which creditors will be paid when there are claims against a homestead that result in a judgment against the homeowner.

License

Permission to enter onto the land of another for a specific purpose and/or length of time.

Express Reservation

Property interest identified in deed as retained by grantor.

Deed Restriction

Provision placed in a deed by the grantor that limits the property's use or requires the grantee to fulfill requirements of subdivision covenants conditions, and restrictions (CC&Rs).

Trustee in Bankruptcy

See Bankruptcy.

Dominant Tenement

See Easement

Servient Tenement

See Easement.

Easement by Condemnation

Taking of an easement right by a public entity.

Judgement

The final determination of a court of competent jurisdiction of a matter presented to it; may include an award of money damages.

Power of Eminent Domain

The government's right to take property for a public purpose on payment of just compensation to the property owner.

Plaintiff

The person who sues in a court action.

Attachment

The process by which real or personal property of a party to a lawsuit is seized and retained in the custody of the court.

Easement

The right to a specific use of or the right to travel over the land of another. The land being used or traveled over is the servient tenement; the land that is benefitted by the use is the dominant tenement. An easement appurtenant is a property interest that belongs to the owner of the dominant tenement and is transferred with the land; an easement in gross is personal right that usually is not transferrable by its owner.

Encroachment

The unlawful intrusion of a property improvement onto adjacent property.

Six-Month Rule

Time period in which a homeowner can sell one home and move into another , less costly one, in order to pay debts that would otherwise threaten a sale of the homestead.

Marketable Title

Title that a reasonably prudent purchaser, acting with full knowledge of the facts and their legal significance, would be willing and ought to accept.

Express Grant

Transferring Real Estate by means of a deed.

Writ of Execution

A court order directing the sheriff or another officer to satisfy a money judgment out of the debtor's property, including real estate not exempt from execution.

Bankruptcy

A federal court proceeding in which the court takes possession of the assets of an insolvent debtor and sells the nonexempt assets to pay of creditors on a pro rata basis; title to the debtor's assets is held by a trustee in bankruptcy.

Homestead

A house, especially a farmhouse, with adjoining buildings and land.

Restriction

A limitation on the use of real property; public restrictions imposed by government include zoning ordinances ; private restrictions imposed by deed may require the grantee to do or refrain from doing something See also CC&Rs.

Defendant

A person against whom legal action is initiated for the purpose of obtaining crimminal sanctions (in a case involving violation of a penal statute) or damages or other appropriate judicial relief (in a civil case).

Condition

A qualification of an estate granted that can be imposed only in a conveyance; it can be a condition precedent or a condition subsequent. See also CC&Rs.

Homestead Exemption

A statutory exemption of real property used as a home from the claims of certain creditors and judgments up to a specified amount.

Mechanic's Lien

A statutory lien against real property in favor of persons who have performed work or furnished materials for the improvement of the property.

Injunction

A writ or an order issued by a court to restrain one or more parties to a suit or proceeding from doing an act deemed to be inequitable or unjust in regard to the rights of some other party or parties in the suit or proceeding.

Easement by Prescription

Acquiring a specific use of or the right to travel over the land of another by statutory requirements similar to those for adverse possession.

Zoning

An act of city or county government specifying the possible uses of property in a particular area.

Covenant

An agreement or a promise to do or not to do a particular act, usually imposed by deed. See also CC&Rs.

Easement by Necessity

An easement right over the land of the grantor of adjacent property that would otherwise be landlocked.

Easement Appurtenant

An easement right that is transferred along with title to the land benefits from the easement.

Easement in Gross

An easement right with no accompanying property ownership right.

Easement by Implication of Law

An easement that will be created by law to provide access to a parcel of land that is otherwise landlocked.

Lien

An encumbrance that makes property security for the payment of a debt or discharge of an obligation; a voluntary lien is one agreed to by the property owner, such as a deed of trust; an involuntary lien exists by operation of law to create a burden on property for certain unpaid debts, such as a tax lien.

Restraint on Alienation

An illegal condition that would prohibit a property owner from transferring title to real estate.

Tax Lien

An involuntary lien that arises from a taxpayer's obligation to pay real property taxes, state income and estate taxes, or federal income, gift, and estate taxes.

Cloud on the Title

Any claim, condition, or encumbrance that impairs title to real property

Encumbrance

Anything that affects or limits the fee simple title to or affects the condition or use of real estate.

Payment Bond

Bonding that may be required of a building contractor to compensate the property owner if the contractor defaults in performance of contract obligations, such as payment of subcontractors, workers, and suppliers.