Perhaps the most common encumbrances on most titles are liens, especially tax and mortgage liens. Other types of liens that may also encumber the title include judgment liens, mechanic's liens and debt-related liens.
These liens are all encumbrances on the title. But their existence may not necessarily mean that the title is not marketable. Buyers have a right and typically do demand that all liens are removed. However, tax and mortgage liens are often satisfied from the proceeds of the buyer's purchase funds. Escrow closings allow the escrow agent to satisfy and release all non-permitted liens without jeopardizing the buyer's title and funds.
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