Which encumbrance is a lien rather than a use restriction?
Correct Answer
D) An established lien securing unpaid property taxes
A lien secures payment of an obligation against property. The stated tax lien is monetary security; easements grant use rights and private covenants restrict use. Creation, priority and enforcement depend on applicable law and are not decided by this generic classification.
Why This Is the Correct Answer
Option D is correct because a lien securing unpaid property taxes is a monetary encumbrance that secures payment of an obligation against the property. Property taxes become a lien against the real property on the lien date. Unlike easements or covenants, it does not grant use rights or restrict how the land is used.
Why the Other Options Are Wrong
Option A: A recorded view easement over the lot
Option A, a recorded view easement over the lot, limits what can be built or done so that a view is preserved. It is a use-related encumbrance, not a claim securing payment of money.
Option B: A private subdivision covenant restricting the use of lots
Option B, a private subdivision covenant restricting the use of lots, controls how the property may be used. It is a use restriction rather than a lien.
Option C: An appurtenant access easement to the lot
Option C, an appurtenant access easement to the lot, gives a right to use land for access. It is a use right, not a lien securing a debt.
Liens Mean Money
A lien is about money owed; easements and covenants are about use.
How to use: Use this to classify an encumbrance as monetary or use-related.
Exam Tip
Ask whether the encumbrance secures payment or controls use; the one securing payment is the lien.
Common Mistakes to Avoid
- -Calling an easement a lien
- -Treating private covenants as monetary encumbrances
- -Overlooking that unpaid property taxes create a lien
Concept Deep Dive
Analysis
This question tests the difference between a lien and a use restriction. A lien is a monetary claim that secures payment of a debt or obligation against property, while easements and covenants affect how the property can be used. A lien for unpaid property taxes is the monetary encumbrance among the choices.
Background Knowledge
Encumbrances fall into monetary types, such as mortgages, tax liens and judgment liens, and non-monetary types, such as easements, deed restrictions and encroachments. Appraisers identify encumbrances because they can affect the rights being appraised and the property's value.
Real-World Application
While researching title for an appraisal, an appraiser notes a utility easement, subdivision covenants and a delinquent property tax lien. She treats the easement and covenants as use factors in her analysis and notes the tax lien as a monetary claim.
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