Encumbrance - Definition and Overview

Anything that affects or limits the fee simple title to a property, such as mortgages, leases, easements, liens, or restrictions.

Also is a term used by colleges and universities to describe limitations placed on a student's account due to late payment, late registration, or other reasons stated by the institution. An encumbrance can prohibit students from registering for classes, affect the release of their transcripts, or delay the reception of their diplomas.