What is Encumbrance Certificate (EC)?
An Encumbrance Certificate (EC) is an important document used as a proof of free-title/ownership of a property. The document is required when buying or selling a property or when availing a home loan or loan against property to verify that the concerned property is free of any monetary or legal liabilities.
|The word “Encumbrance” refers to any financial or non-financial claims on a property by parties other than the title-holder of the property.|
Individuals can get Encumbrance Certificate from the Sub-Registrar’s office where the property was registered.
Why is Encumbrance Certificate Important?
The importance of an Encumbrance Certificate is expressed in the following points:
- Buying a property is a huge investment making it important for buyers to check for any encumbrances as it may transfer to them along with the property ownership. Getting “Encumbrance Certificate” of a property gives a buyer assurance of the fact that the property does not have any financial or non-financial liabilities such as liens, outstanding loans and leases.
- Since the document is also furnished at the time of loan against property and home loan application, it is important that buyers obtain the document to not only to secure the legal title of the property but also to ensure that the buyer will be eligible for the loan.
- Other scenarios where the Encumbrance Certificate might be required are:
- To get mutation of property (Khata Registration / Khata Transfer / Patta) done, the documents is submitted
- If the concerned property or land tax is not paid for more than 3 years, the certificate is provided to the Village / Panchayat Officer to update the land tax records
- To withdraw PF for a property purchase or house construction
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What does an Encumbrance Certificate Include?
An Encumbrance Certificate for a specific time-frame includes the list of all registered transactions related to the property that took place during the requested time-frame. Individuals can get Encumbrance Certificate of a property for up to a period of 30 years.
Note that, if you are asking an EC for a particular period, you will get the details only for that period and not more. The details will be given from the entries available in the register available with the sub-registrar.
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What are the Different Types of Encumbrance Certificate?
The Encumbrance Certificate is usually issued in 2 forms – Form 15 & Form 16
- Form 15 – The ‘Form 15’ is issued when the property has any encumbrance during the said period. It includes information such as the nature of the encumbrance such as gift, partition, lease and loan, the parties involved, the registered number of the document and other details in a date-wise manner
- Form 16 – The ‘Form 16’ or ‘Nil Encumbrance Certificate (NEC)‘ is issued when the property does not have any encumbrance during the said period
Note: While an Encumbrance Certificate contains all transaction details related to a property, however, it may not be enough to prove the ownership of the property. Therefore, it is wise for buyers to obtain a Possession Certificate along with an EC.
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How to Get Encumbrance Certificate of a Property Online?
Individuals can get Encumbrance Certificate of a property from the Sub-Registrar’s office where the property was registered. In some states such as Andhra Pradesh, Gujarat, Karnataka, Kerala, Odisha, Puducherry, Tamil Nadu and Telangana, individuals can get Encumbrance Certificate online. The official website of these states issues computerized EC extracts for the ease of individuals. In other states, individuals need to get a handwritten certificate to ascertain the real state regarding its encumbrances.
Steps to Get Encumbrance Certificate Online:
- Submit an application for EC to the Registration Office in Form 22, along with an attested copy of the proof of address, details of the concerned property, and the fee applicable for availing the certificate
- The officer will inspect the indexes for details in the mentioned period
- An EC will be issued for the mentioned period, provided there is transaction history during the specified period. If no transactions took place during the duration, a Nil Encumbrance Certificate (NEC) will be issued
- The EC is generally issued within 15 to 30 days from the date of application
- The forms for EC applications and certificates are mentioned in the annexures to the rules of the Registrations Acts of the respective states. Generally, an application is made in Form No. 22, EC is issued in Form No. 15 and NEC is issued in Form No. 16 of the respective state rules
Note: The EC will reflect only those transactions and documents that have been registered with Registrar’s office.
What is the Application Fee to Get an Encumbrance Certificate?
The application fee required to obtain the Encumbrance Certificate varies from one state to another. It also depends on the location of the property and the state government. The application fees in some of the popular states are:
|Andhra Pradesh and Telangana (as on 17 August 2013)||Search and issue of certified EC copy – Rs. 200 per certificate Search|
Issue of EC copy up to 30 years – Rs. 200 per certificate
Issue of EC copy more than 30 years – Rs. 500 per certificate
|Kerala (As on 31 March 2018)||Single search and copy – Rs. 10 extra sheets Over first 2 sheets used – Rs. 10 per sheet|
Note: Please check with your respective authorities for the updated application fees and charges.
How Long Does it Take to Get an Encumbrance Certificate?
As mentioned earlier, the process to obtain an EC differs from one place to another. If you apply for an EC in person at a Sub-Registrar’s Office, you will get the certificate within 15 to 30 days.
However, if you apply for an EC online, you will get it faster. Online applications usually take 2 to 3 working days to be processed.
What is Nil Encumbrance Certificate?
When you apply for an Encumbrance Certificate, you will be asked to specify the period for which you need the information.
If there are no charges placed on the property during the requested period, a “Nil Encumbrance Certificate” will be issued. This means that no lender has placed a lien on the property during that period.
What are the Documents Required to Get an Encumbrance Certificate?
Some of the documents that you may require when applying for an Encumbrance Certificate are:
- Applicant’s proof of address
- Property registration document
- Property details and its title deed details
- The property sale deed/gift deed/partition deed/release deed if a deed has been executed previously
- The deed number upon registration containing the date and book number along with the signature of the applicant
Note: The above list is only indicative. Additional documents may be asked by the concerned authority. To know more about Encumbrance Certificate in your region, contact the nearest Sub-Registrar’s Office.