Ontario Mortgage Agent Practice Exam

An encumbrance places limits on the rights of a fee simple owner, such as restricting their ability to sell or transfer the property. Option A is incorrect because an encumbrance does not facilitate ownership transfer, it actually hinders it. Option B is incorrect because an encumbrance does not restore full ownership rights, it limits them. Option C is incorrect because an encumbrance does not provide tax incentives, it imposes restrictions on the owner.