An encumbrance search begins with the current record of title, but the title usually provides only a short notation and instrument number. To understand the real effect, identify each registered interest, obtain the relevant instrument and plan, and relate its parties, land and operative terms to the decision you are making.
What's really registered against your property? An encumbrance search reveals every legal interest affecting your title. Here's what to look for and why it matters.
Need to check encumbrances on the actual title?
Order the current title first. If an encumbrance refers to a registered instrument, order the instrument document too.
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What is an Encumbrance?
An encumbrance is any registered interest on a property title that affects the owner's rights. While you legally own the property, encumbrances create obligations, restrictions, or rights that others hold over your land.
Think of encumbrances as the fine print of property ownership. The land is yours, but it comes with conditions attached.
Types of Encumbrances in New Zealand
Mortgages
The most common encumbrance. A mortgage gives a lender security over your property until you repay the loan.
What it means for you:
- You can't sell without the lender's involvement
- The lender has rights if you default on payments
- Mortgage is discharged (removed) when fully repaid
What to check: How many mortgages are registered? Multiple mortgages may indicate financial stress.
Easements
Rights that allow someone else to use part of your land for a specific purpose.
Common types:
- Right of way — access across your property
- Drainage easement — pipes running through your land
- Utility easement — power, water, or telecommunications infrastructure
- Light and air — preventing you from building to block a neighbour's light
What it means for you:
- You can't build over or block an easement area
- You may have maintenance obligations
- Easements typically survive changes of ownership
Covenants
Rules registered on the title that restrict how you can use the property.
Common types:
- Building materials or design requirements
- Fencing obligations
- Restrictions on business use
- Requirements to maintain certain standards
What it means for you:
- You must comply regardless of whether you agreed to them
- Breaking a covenant can lead to legal action
- Some covenants can be modified or removed through legal processes
Caveats
A caveat is a notice that someone claims an interest in the property. It's a warning, not a proven right.
What it means for you:
- The property can't easily be transferred while a caveat exists
- The claimed interest needs to be investigated
- Caveats should be resolved before any transaction
Encumbrance Instruments
Specific registered documents that create obligations — often used for:
- Body corporate obligations
- Development contributions
- Consent notice conditions
- Bond requirements
How to Read the Encumbrance Section of a Title
When you receive your certificate of title, the interests section lists all encumbrances. Here's how to decode it:
The Format
Each entry typically shows:
- Instrument type — what kind of interest (easement, mortgage, covenant, etc.)
- Instrument number — the unique reference for the full document
- Parties involved — who created or benefits from the interest
- Brief description — summary of what it does
- Date registered — when it was placed on the title
What to Look For
| Check | Why It Matters |
|---|---|
| Number of interests | More interests = more obligations to understand |
| Types of easements | Some are minor, others significantly affect property use |
| Covenant restrictions | Could prevent your plans |
| Active caveats | Need resolution before purchase |
| Old vs current interests | Some may be historic and no longer enforced |
Why Encumbrance Searches Matter
For Buyers
Understanding encumbrances before you buy prevents nasty surprises. A right of way through your backyard or a covenant preventing a second storey could change whether you want the property.
For Sellers
Knowing what's on your title helps you prepare for buyer questions and address issues before listing.
For Developers
Every encumbrance potentially affects what you can build and how you access the property. Title due diligence is essential before committing to a development.
For Professionals
Lawyers, planners, and engineers need complete encumbrance information to advise their clients properly.
Going Beyond the Title: Full Instrument Searches
The certificate of title tells you that encumbrances exist, but the title summary alone doesn't give full details. For complete information, you need the instrument documents themselves.
What Instruments Reveal
An easement instrument, for example, will tell you:
- Exactly what the easement allows
- The specific area affected
- Maintenance responsibilities
- Any time limitations
- Conditions or exceptions
When You Need Full Instruments
- Buying property — your lawyer should review all instruments
- Planning building work — check if easements affect your plans
- Resolving disputes — full terms clarify rights and obligations
- Consent applications — councils often require instrument copies
Our instrument documents are available from the price shown on the product page per document.
Common Encumbrance Issues
Issue 1: Undisclosed Easements
You buy a property and discover a drainage easement runs through the middle of where you planned to build a garage.
Prevention: Always order the full title and review all easements before purchasing.
Issue 2: Restrictive Covenants
Your dream renovation is blocked by a covenant requiring single-storey construction only.
Prevention: Read all covenant instruments during due diligence. Consider whether you can live with the restrictions.
Issue 3: Neighbour Disputes Over Access
A right of way easement exists, but you and your neighbour disagree on maintenance responsibilities.
Resolution: The easement instrument defines obligations. A clear reading usually resolves the dispute.
Issue 4: Historic Encumbrances
The title shows an encumbrance from 1950 that no longer seems relevant.
Resolution: Some old encumbrances can be removed through legal processes, but they remain valid until formally discharged.
Removing or Modifying Encumbrances
Mortgages
Automatically discharged when the loan is repaid. Your lender registers the discharge.
Easements
Can be removed or modified if:
- All parties agree (both benefiting and burdened land owners)
- Court application is made (if agreement isn't possible)
- The easement is no longer necessary
Covenants
Can be modified or removed through:
- Agreement of all parties
- Application to the High Court under the Property Law Act
- Some expire after a set period
Caveats
Can be removed by:
- Withdrawal by the person who lodged it
- Lapsing notice process
- Court order
Practical process
- List every mortgage, easement, covenant, caveat, charge, notice and other interest shown on the current title.
- Separate entries that merely record status from entries whose instruments contain rights, restrictions or financial obligations.
- Order the instruments that could affect ownership, access, building, finance or settlement and have material terms reviewed in context.
Decision guide
| Situation | Next step |
|---|---|
| The title lists an unfamiliar interest | Use the instrument number to obtain the underlying document rather than guessing from the label. |
| An interest refers to another plan or title | Collect the referenced material and map the benefited and burdened land before drawing a conclusion. |
| The interest may affect settlement or finance | Raise it with the conveyancer and lender early enough for discharge, consent or another condition to be arranged. |
Common mistakes and risks
- Treating all registered interests as financial debts or defects.
- Reading the title notation without obtaining the instrument that creates the rights.
- Assuming an old entry no longer matters because it is not visible on the land.
Key takeaways
- The title is the index; the instrument usually contains the decision detail.
- Different interests affect ownership, use, access and settlement in different ways.
- Prioritise the entries that could change the transaction or intended use.
Sources and related guides
The land title legislation explains registered interests and priority, while government buyer guidance recommends checking the title and seeking legal advice before committing to a property.
Official sources
Continue your research
Legislation and guidance reviewed 2026-09-28. This guide is general information, not legal or surveying advice.
Frequently Asked Questions
What's the difference between an encumbrance and an interest?
The terms are often used interchangeably. Technically, an encumbrance is any interest that burdens the property — mortgages, easements, covenants, and similar interests.
Do all properties have encumbrances?
Most properties have at least a mortgage (if financed) and many have easements or covenants. It's unusual to find a completely unencumbered title.
Can I build over an easement?
Generally no. Building over an easement area can be a legal issue. Always check easement terms before planning construction.
How much does an encumbrance search cost?
A certificate of title showing all registered encumbrances starts from the price shown on the product page. Individual instrument documents are available from the price shown on the product page each.
Should I worry about old encumbrances?
Not necessarily, but don't ignore them either. Have your lawyer review all interests to confirm which ones are still relevant and enforceable.
Can encumbrances reduce property value?
Potentially. Significant easements or restrictive covenants can affect value, particularly if they limit development potential.
Get Complete Encumbrance Information
Don't leave property decisions to guesswork. A comprehensive title search reveals every registered interest affecting your property.
Certificate of Title NZ provides:
✅ Complete title searches — all encumbrances listed
✅ Instrument documents — full details from the price shown on the product page
✅ Fast delivery — within the current service timeframe shown on the product page
✅ Expert service — we explain what you're getting
Need to understand what's registered against a property? Order your title search today.
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