Encumberances

Question 1

What is an encumbrance?

Answer 1

It is a nonpossessory right or
interest in real property held by someone other than the property
owner.

Question 2

Voluntary vs. involuntary lien

Answer 2

Voluntary - debtor gives the creditor, like a mortgage or deed of trust.

Involuntary - statutory, attached by operation of law with out the owner’s consent. Tax and judgement liens.

Question 3

General vs. Specific liens

Answer 3

General - Attaches to all the debtor’s real and personal property

Specific - attaches only to one piece of property

Question 4

What are the types of liens?

Answer 4

• Mortgage
• Deed of trust
• Construction
• Judgement
• Attachment
• Property Tax
• Special Assessment
• IRS

Question 5

What is the priority of a construction lien?

Answer 5

Set according to the date the work began, not when it was recorded. In WA, must be recorded no later than 90 days after the claimant has stopped working or providing materials for the project.

Question 6

How does a judgement lien work?

Answer 6

Debtor must pay the judgement or the court can issue a writ of execution to sell the property to satisfy the debt. The debtor can record a satisfaction of judgement to provide notice that the lien has been paid.

Priority is according to the date the court enters judgment.

Question 7

What is a writ of attachment?

Answer 7

It’s a lien preventing the owner from selling the property before a verdict is reached. A Lis Pendens can also be filed, it’s not a lien but it is constructive notice of a pending lawsuit.

Question 8

How does lien priority work?

Answer 8

First to record, first in right, with the exception of property tax and special assessments which always have priority.

• Construction: Date work began
• Judgement: Date court enters judgement

Question 9

What are homestead laws?

Answer 9

They give homeowners limited protection against foreclosure. In WA, they apply only to judgment liens. Creditor cannot foreclose unless the net value of the owner-occupied property is greater than the homestead exemption created by state law.

Question 10

What is an easement appurtenant?

Answer 10

Burdens one piece of land for the benefit of the other. Runs with the land, ordinarily must be recorded unless it’s readily apparent that it is in use.

Servient tenement - burdened
Servient tenant - owner of burdened land
Dominant tenement - benefitted
Dominant tenant - owner of benefitted land

Question 11

What is an easement in gross?

Answer 11

Benefits a person or commercial property, not a parcel of land.

Question 12

How can easements be created?

Answer 12

• Express grant
• express reservation
• implication/necessity (can be done by court)
• prescription (adverse possession without exclusive, or consistent with how an owner would use it)

Question 13

How is an easement terminated?

Answer 13

• Release (must be in writing, usually QCD)
• Merger (both tenements under one owner)s
• Failure of purpose
• Abandonment
• Prescription (servient tenant prevents use for 10 years)

Question 14

What is a profit (encumbrance)?

Answer 14

Allows someone to enter the property and take something from it (timber, gravel, etc)

Question 15

What is a license?

Answer 15

It’s a right to use land, but it must be:
- Temporary
- Revokable
- Not able to be assigned
- does not encumber the and
- often oral

Question 16

What is an encroachment?

Answer 16

Physical object that lies wholly or partially on someone else’s property. These are not covered by standard title insurance and they may require a survey to determine if they exist before issuing an extended policy.

An owner may file an ejectment suit in order to get the encroachment removed.

Could ripen: prescriptive easement or adverse possession.

Question 17

What is a nuisance (encumbrances)?

Answer 17

An activity or condition on neighboring property that interferes with a property owner’s use or
enjoyment of his own property. Not technically an encumbrance but a violation of the owner’s possessory rights.

Question 18

What are private or deed restrictions?

Answer 18

They are imposed by a prior owner on the deed, and run with the land. They cannot violate the law and if they are not followed can be enforced through private court action. The procedure enforcing the restriction is an injunction.

Question 19

What are CC&Rs?

Answer 19

Covenants, conditions and restrictions. They do not impact marketability of title and are supposed to enhance property value. They are recorded and referenced in the deeds for the subdivision.

Question 20

What if the owners don’t enforce the CC&Rs?

Answer 20

CC&Rs may
no longer be enforceable
if subdivision owners have
failed to enforce them in the
past

Question 21

What if the CC&Rs conflict with other restrictions?

Answer 21

The stricter provisions will prevail.