Verified answer

Any rights and remedies the buyer might have should be spelled out in the sales contract.

It usually boils down to this. The seller needs to provide clean and marketable title, and if they can not do so then the buyer would be releases from the contract and given their earnest money deposit back.

Depending on the severity of the encroachment and encumbrance it might not effect the value of the property and the buyer & lender might not have any issue's with it, e.g. I had this exact circumstance happen on a property I purchased about 10 years ago. It amounted to the neighbors fence and garage being a foot over the property line in the rear of my property...It had been that way for decades, and I let it stay that same way. I also sold the property 6 years later with no problems or issues.

This looks like a homework question and should be posted there.

If you have a specific question you don't understand after reviewing your materials, express that point in your own words and perhaps someone will help point you in the right direction.

If you are a REALTOR® you should have access to free Legal advise provided by your state Association of REALTORS®.