Past due taxes would appear on a title report as which type of issue?

When reviewing a title report, past due taxes are classified as an encumbrance. This classification is significant because encumbrances represent claims, burdens, or liabilities affecting the property's title that can impact the owner's ability to sell or utilize the property. Past due taxes create a financial obligation that must be resolved, as tax authorities may place a lien on the property, which can complicate or hinder the sale or transfer of the property until the debts are cleared.

In contrast, encroachment relates to a situation where a structure or object illegally extends onto another person's property, which has different implications for property use and ownership. Lis pendens indicates a pending lawsuit concerning the property, which signals to potential buyers that there may be legal complications but does not relate directly to financial obligations like taxes. Adverse possession involves someone claiming ownership of land under certain conditions, which is also unrelated to the immediate financial obligations represented by past due taxes. Thus, categorizing unpaid taxes as an encumbrance helps clarify the ongoing financial responsibilities that the property owner must address.