What term is used to describe interests in property that are not possession-based?

The term "encumbrances" is indeed used to describe interests in property that do not involve possession. An encumbrance refers to a claim, lien, charge, or liability against a property that can affect the use or transfer of that property. Examples include mortgages, easements, and restrictive covenants. These interests do not grant ownership or possession but do impose certain restrictions or obligations related to the property.

In contrast, possessory interests involve a right to occupy and use the property, such as in the case of homeowners or tenants. Tenancy relates to the specific rights and responsibilities associated with occupying a rental property, whereas leases are contractual agreements that grant tenants the right to use property for a specified time under certain conditions. Therefore, encumbrances are the appropriate term for interests in property that do not grant possession.