unencumbered

adjective

un·en·cum·bered | \ ˌən-in-ˈkəm-bərd

Definition of unencumbered

: free of encumbrance

Examples of unencumbered in a Sentence

Recent Examples on the Web

South Korean troops examining now-empty guard posts north of the border were allowed unencumbered access to the installations by North Korean soldiers, a presidential spokesman said. — Andrew Jeong, WSJ, "Kim Jong Un’s Seoul Trip on Ice as Korean Detente Cools," 12 Dec. 2018 His success will depend on the ability of Sacramento’s citizens to take his policy positions seriously, unencumbered by his past struggles. — Lincoln Anthony Blades, Teen Vogue, "Stevante Clark is Running for Mayor of Sacramento," 3 Jan. 2019 That means Google has a new canvas for its virtual Assistant to work with, unencumbered with the need to support any of the cruft that would come along with running full Android or Chrome. — Dieter Bohn, The Verge, "Lenovo Smart Display review: the Google appliance," 26 July 2018 The growth of both startups has been seemingly unencumbered by reports of dead dogs, uninsured workers, and unhappy customers. — Chavie Lieber, Vox, "The startup world’s cuddly, cutthroat battle to walk your dog," 12 Sep. 2018 In all cases, the Commission’s intent has been to protect the right of European citizens to have a free choice when shopping, unencumbered by border considerations. — Vlad Savov, The Verge, "Asus, Philips, and others fined for price fixing in Europe," 24 July 2018 Bilhartz said the McHaneys are simply looking to sell produce to make their market garden sustainable, unencumbered by overreaching government rules. — San Antonio Express-News, "Texas couple won’t abide by state’s definition of a pickle," 31 May 2018 Websites load quickly and my system is left unencumbered. — Chris Wilkinson, Ars Technica, "1990, meet 2018: How far does 20MHz of Macintosh IIsi power go today?," 1 July 2018 In countries around the world, people live their lives unencumbered by social media, American consumerism and Donald Trump. — New York Times, "Readers Remember Anthony Bourdain, Passionate Traveler," 12 June 2018

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'unencumbered.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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6 Feb 2019

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The first known use of unencumbered was in 1722

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More Definitions for unencumbered

unencumbered

adjective

Financial Definition of unencumbered

What It Is

An encumbrance is a limitation on the ownership of a property. When an asset is unencumbered, there are no limitations on its ownership.

How It Works

To understand what unencumbered means, it's important to understand how encumbrances work. In the real estate world, an encumbrance is similar to a lien. The bond world also includes encumbrances. For instance, let’s consider a $100 million bond issue by Company XYZ. If Company XYZ is willing to pledge $100 million of its assets to the bondholders (that is, let the bondholders place liens on specific assets that they may seize in the event of default), giving them a little extra assurance that they will be paid on time, then the bonds would be considered securitized or asset-backed, because the assets have $100 million of encumbrances on them.

Why It Matters

Encumbrances provide security to lenders and bond investors in the case of bankruptcy or default. For example, it is important to note that debentures do not have encumbrances — that is, they are not secured by specific pieces of property or collateral and they do have a general claim on the assets and earnings of the issuer. Therefore, if the issuer were to liquidate, the holders of the debenture bonds have a claim on any assets not specifically pledged to secure other debt. Unencumbered assets can therefore help reduce the risk of debt if they become encumbered.

Companies that are extremely creditworthy often have no reason to encumber specific assets in order to sell a bond issue because they’ll still pay relatively low interest rates. (This is why debentures, which do not have encumbered assets attached, can sometimes sell for more than bonds with encumbrances from less creditworthy issuers.) Sometimes issuers also want to leave their assets unencumbered in order to make future financings possible.

Source: Investing Answers

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