What is the difference between a lien and an encumbrance?

A lien is a legal claim or right against a property that typically arises from a debt or obligation, meaning that it relates specifically to amounts owed, such as mortgages, tax debts, or mechanic’s liens. This makes a lien a type of encumbrance, but unique in that it is primarily concerned with the financial obligation tied to the property.

On the other hand, an encumbrance encompasses a broader range of claims against a property that may affect its use or marketability but do not necessarily entail a debt. These can include easements, restrictions, or other rights that others may have concerning the property. Thus, while all liens are encumbrances, not all encumbrances are liens. This distinction highlights that a lien is specifically about a debt-related claim, setting it apart from other potential restrictions on property use that may not involve any financial obligation.