California Real Estate: Encumbrances, Liens, and Homesteads

Flashcards covering encumbrances, liens, and homesteads in California real estate.

What is an encumbrance?

A burden on title, which can be physical or monetary (liens).

What is the difference between a physical encumbrance and a lien?

A physical encumbrance is non-monetary, while a lien is a money encumbrance.

What is an easement?

The limited right to enter and use all or a portion of the land of another without being a trespasser and without paying rent.

What are the two classes of easements?

Easement Appurtenant and Easement in Gross.

What are the ways an easement can be created?

Deed, Necessity or by Implication, Dedication (Recorded Plat Map), Condemnation, Prescription, Estoppel, and Encroachment.

What are the requirements for an easement by prescription?

Actual, open and notorious use; continuous use (5 years, uninterrupted); hostile (without permission of owner); claim of right or color of title; no need to pay property taxes.

How can an easement be terminated?

Express release by deed, Abandonment, Destruction of Servient Tenement, Expiration, Merger, or Lack of use for 5 years (Prescriptive easement only).

What is an encroachment?

The wrongful extension (trespass) of a structure or any improvement onto the property of another.

What is the statute of limitations for encroachment?

Three years

What are private covenants?

Promises (CC&R’s) that create restrictions on land use. Discrimination is unenforceable.

What are public restrictions?

Zoning Ordinances, Building codes, Safety codes, and Health codes.

Name examples of liens.

Deed of Trust/Trust Deed, Mechanic’s Lien, Tax Lien, Assessment, Judgment Lien.

What determines the priority of a Mechanic’s Lien?

Date of work commencement.

What is the purpose of a Preliminary Notice regarding Mechanic's Liens?

States worker's right to file a lien, typically 20 days after work starts.

What are the statutory time periods for filing a mechanic's lien after a Notice of Completion is filed?

Original Contractor: 60 Days after filing. All Others: 30 Days after filing.

How long does someone have to execute a Mechanic’s Lien once it is filed?

90 Days after filing

How is a Judgment Lien created?

By a Court of Law

How long does a Judgment Lien last?

10 years

What are major types of tax liens?

Unpaid Real Property Taxes, Unpaid Federal Income Taxes, Unpaid State Inheritance Taxes, and Unpaid Gift Taxes.

What is the purpose of a Declaration of Homestead?

Designed to protect homeowner’s equity.

What are the requirements for a Declaration of Homestead?

Recorded Document, Filed showing “Head of Household”, Declare claimant is residing on property (Home, boat, motor home, mobile home on a lot), Description of property, Owner-occupied residence, Only ONE homestead at a time.

How can a Homestead be terminated?

Sell the home or File a Notice of Abandonment