Property Ownership
Which type of encumbrance is a financial claim against a property as security for a debt?
AEasement
BLien✓ Correct
CEncroachment
DCovenant
Explanation
A lien is a financial encumbrance — a claim against property as security for a debt. Liens include mortgages, property tax liens, judgment liens, and mechanics' liens.
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Key Terms to Know
Lien
A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
EncumbranceAny claim, lien, charge, or liability attached to real property that affects its value or limits its use.
EasementA non-possessory right to use another person's land for a specific purpose.
Title InsuranceInsurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
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