For property owners and buyers alike, the concept of a clear title is paramount. One of the most critical steps in achieving this is the cancellation of encumbrance. By definition, an encumbrance is any legal interest that someone other than the owner has in the land.
Why Cancellation Matters
Most owners seek the cancellation of encumbrance to prove that their property is unburdened. Unresolved encumbrances can stall real estate deals and prevent owners from accessing the full equity of their homes.
What Needs to be Cancelled?
The process begins with recognizing the specific nature of the claim against your title. Common examples include:
Mortgages and Liens: Loans or tax debts that have been registered against the deed.
Easements: Legal permissions for neighbors or utilities to access specific areas.
Property Restrictions: Rules that limit how the property can be used or developed.
Steps to a Clean Title
To successfully remove these claims, you must follow a structured series of actions.
First, perform a thorough title search to identify all existing encumbrances.
If the encumbrance is a lien or mortgage, the underlying debt must be paid in full.
Get a Discharge: The creditor must provide a "Release of Lien" or cancellation of encumbrance "Discharge of Mortgage" document.
File with the Authorities: The final step is filing the cancellation with the county or municipal clerk to update public records.
Challenges and Legal Considerations
The cancellation of encumbrance is not always a simple task. For instance, if a lienholder has cancellation of encumbrance gone out of business or a private lender cannot be found, you may need to file cancellation of encumbrance a "Quiet Title" action in cancellation of encumbrance court.
Final Thoughts
Securing a cancellation of encumbrance is an investment in your cancellation of encumbrance property’s future. Do not wait until you are in the middle of a sale to check for these legal hurdles.