Encumbrances

An encumbrance is some charge attached to a piece of real estate that diminishes its value and/or interferes with its use. Encumbrances typically fall within two categories: public or private.

Public Encumbrances - those imposed upon the real estate by some governmental body (state, county, municipality).

Private Encumbrances - given voluntarily or involuntarily to individuals and/or entities.

Public Encumbrances

Zoning Regulations (bylaws) - restrictions on the use of real estate by municipalities in the interest of the public welfare. These are valid so long as they serve some reasonible purpose that is related to the public welfare. There are a couple of ways that properties can be used in ways other than zoning requires.

"Grandfather" - if a piece of property has been in use a certain way prior to zoning, and is prohibited by the zoning, it may continue to be used despite the zoning going into effect.

"Exceptional Situation" - a person may ask their municipality to use a property in a fashion that is s"prohibited" by zoning regulations. This is sometimes referred to as a Special Permit, or a "Variation."

Building Codes - these encumbrances regulate the materials and the manner of installing those materials when developing a piece of real estate. These codes are enforced by building inspectors and they serve the purpose of protecting those who inhabit the building and any visitors to the building.

Subdivision Regulations - Subdivision regulations are in place to ensure that any new neighborhood development will have sufficient infrastructure to support the neighborhood. These regulations require that before building has begun, the developer must furnish the municipality with an acceptable plan for the development, as well as some sort of bond to ensure that the municipality will have the funds to carry out the plan if the developer can't.

Environmental Protection Laws - This encumbrance is found in Massachusetts and is in place to protect the real estate of Massachusetts from pollution. If the owner of a property is creating pollution, they will be required by the state to clean it up. If the owner does not clean up the pollution, the state will step in and do so, but this will create a lien against the property for the cost of the cleanup. If payment is not received, the state has the right to foreclose on the property to gather reimbursement.

Real Estate Taxes - Municipalities have the power to levy taxes against any property within its boundaries for the purpose of financing the services that the community offers. The real estate tax takes priority over all other encumbrances.

Power of Eminent Domain - The government of Massachusetts has the power to take private property for public use. There are two criteria, which both are required to be met, for the state to take a piece of property through eminent domain.

The state must need the property for public use.

The state must pay the owner of the property a fair price for the property.

The owner of the property has the right to contest either one of the previous two criteria.

Private Encumbrances

Judicial Liens - There are two kinds of Judicial Liens in Massachusetts. Attachments and Executions.

Attachment: a lien placed upon real estate of a defendant in a lawsuit by the plaintiff. The court will only grant permission for the plaintiff to use an attachment if the plaintiff can prove they have reasonible probability of winning the case, and the defendant has no other assets from which to pay the judgment.

Execution: This is the legal judgment authorizing the local sheriff to seize the defendant's property after losing a case. The sheriff is then authorized to then advertise and hold a sale of the property in order to pay the creditor to satisfy the judgment. If the property is owned by tenants by the entirety, the property may not be seized and sold.

Ways judicial liens can be discharged:

- Payment of execution or amount of attachment
- Posting bond to secure payment
- Expiration of six year statute of limitations
- Voluntary discharge by the creditor
- Judgment for the defendant

Mechanic's Lien - Whenever one has supplied materials or labor to furnish a piece of real estate, and has not been paid, they may seek to place a lien against the property for repayment. The seeker must have a written contract with the other party, file notice of the contract with the registry of deeds along with a notice that they have done so with the other party, and then the seeker may bring suit against the other party if still not compensated.

Restrictive Covenant - A restrictive covenant is a restriction imposed by the owner of the property upon the use of the property once it is conveyed to someone else. The restrictions are placed upon the land and the new owners must abide by them. The usual purpose of restrictive covenants is to enhance the value of a property and the other nearby properties.

If a new owner violates a restrictive covenant, they may be faced with an injunction, which is a court order prohibiting the further use of the property in violation of the covenant, or they could be required to pay money damages if their violation can be proven. The statute of limitations on a restrictive covenant is 30 years, and it may be renewed by the current owner if they so desire.

Condominium Association Liens - These are imposed to ensure the payment of the indivual unit's owner's common fees.

Mortgage - Lien given by the owner of real estate for the purpose of securing the repayment of a loan or the performance of some other obligation.

Easements - An easement is a right to use the real estate of someone else for a specific purpose. The most common purpose is a right of passage. For more on easements, please go to the easements page.

Disclaimer: The information found on this site is not, and should not be considered, professional legal advice.
Always consult a professional before taking any sort of legal action.