Definition of Encumbrance:
A burden or impediment.
Accounting: A contingent liability, contract, purchase order, payroll commitment, tax payable, or legal penalty that is chargeable to an account. It ceases to be an encumbrance when paid-out or when the actual liability amount is determined and recorded as an expense.
The term is used in accounting to refer to restricted funds inside an account that are reserved for a specific liability.
An encumbrance is a claim against a property by a party that is not the owner. An encumbrance can impact the transferability of the property and restrict its free use until the encumbrance is lifted. The most common types of encumbrance apply to real estate; these include mortgages, easements, and property tax liens. Not all forms of encumbrance are financial, easements being an example of non-financial encumbrances. An encumbrance can also apply to personal – as opposed to real – property.
Real estate: A charge, claim, liability, or regulation that is attached to and is binding upon a property. It may affect the clarity of a good title (see clear title) or may diminish the value of property, but may not prevent transfer of title.
An encumbrance can take several forms: mortgages, claims by other parties, court judgments, pending legal action, unpaid taxes, restrictive deed or loan covenants, easement rights of the neighbors, or zoning ordinances.
Synonyms of Encumbrance
Hindrance, Obstruction, Obstacle, Impediment, Restraint, Constraint, Handicap, Inconvenience, Nuisance, Disadvantage, Drawback, Affliction, Albatross, Bale, Bitter cup, Bitter draft, Bitter draught, Bitter pill, Burden, Burden of care, Burdening, Burthen, Cankerworm of care, Care, Cargo, Charge, Charging, Client, Clog, Cross, Crown of thorns, Cumber, Cumbrance, Curse, Deadweight, Dependent, Difficulty, Disadvantage, Distress, Drag, Embarrassment, Freight, Gall, Gall and wormwood, Grievance, Hamper, Handicap, Hardship, Hindrance, Impedance, Impediment, Impedimenta, Imposition, Inconvenience, Incubus, Incumbency, Infliction, Lading, Liability, Load, Loading, Lumber, Millstone, Obstacle, Obstruction, Onus, Oppression, Overload, Overtaxing, Overweighting, Pack, Pack of troubles, Peck of troubles, Penalty, Pensionary, Pensioner, Pressure, Protege, Public charge, Saddling, Sea of troubles, Sorrow, Superincumbency, Surcharge, Taxing, Thorn, Trouble, Ward, Waters of bitterness, Weight, White elephant, Woe
How to use Encumbrance in a sentence?
- An encumbrance is a claim made against a property by someone other than the current titleholder.
- Some common claims are leases, liens, easements, and mortgages.
- Even though the backpack is uncomfortable and an encumbrance , the contents are an important and vital part in completing the mission.
- The horse raised its hind leg as if to rid itself of an encumbrance.
- Some claims do not affect the value of the property. This is usually seen in commercial cases.
- Every purchase order is entered as an encumbrance on company funds, thereby reserving the use of those funds for a specific purpose.
- Taking care of a disabled person is seen by some as an encumbrance , but disabled people are more than their disabilities and are much more than someone who needs caretaking.
Meaning of Encumbrance & Encumbrance Definition