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Colorado real estate litigation: Dealing with encumbrances

What is an encumbrance? Why could having one on a property lead to real estate litigation in Colorado? What can one do about it?

An encumbrance, in real estate terms, simply means that there is a claim or some sort of imitation placed on a property. This means the property owner will only be allowed to do so much with the property. For example, it may limit one’s ability to construct anything on a piece of land, or it may restrict what kinds of items may be used on the property, or it could limit the owner’s access to his or her property.

Encumbrances come in many forms. First, there are liens. Liens may be placed by creditors, contractors or the government in an effort to collect any money owed them.

Second, there are easements. Easements give other people the right to utilize certain parts of one’s property. For example, a public utility easement will allow various utility companies to dig, run lines or put up utility poles.

Third, there are encroachments. This is where certain aspects of one’s property extend onto another’s property. For example, a fence may be built just over one’s property line or tree branches may be hanging in a neighbors yard. It could be a number of things, and it can reduce the value of one’s property or make selling the property difficult.

Fourth, there are deed restrictions — also known as restrictive covenants. These can limit several things, such as where one can park his or her car, satellite placement or the ability to use a property for business purposes. The purpose of these restrictions is to help with neighborhood property values.

Finally, fifth, there are licenses that allow access. This is something a property owner works out with someone who wants to use his or her property. The access granted is not permanent and does not transfer if the property is sold.

When encumbrances are placed or breached, real estate litigation may be required to resolve the matter. Some encumbrances may be removed or modified, and others may not. Colorado residents can turn to legal counsel for assistance when encumbrance issues arise.