All You Need to Know About Encumbrance Certificate | Hecta

What is an Encumbrance Certificate?

An Encumbrance Certificate is a document that confirms that a particular property is free from any financial or legal encumbrances, which may be a mortgage, a lien, a charge, or any other financial or legal liability. This certificate is issued by the Sub-Registrar’s office, and it is a proof that the property is legally safe to buy or sell.

Why is the Encumbrance Certificate Important?

An Encumbrance Certificate is an essential document required for property transactions like sale, mortgage, lease, or property transfer. It is also essential for availing loans against the property or applying for a loan from a bank. This certificate is also used to resolve any disputes regarding the ownership of the property, which may arise in the future.

How to Obtain Encumbrance Certificate?

There are two ways to obtain an Encumbrance Certificate- Offline and Online.

Offline Process:

To obtain an Encumbrance Certificate offline, you need to follow the below-mentioned steps:

Step 1: Visit the Sub-Registrar’s office in person.

Step 2: Fill out the application form for an Encumbrance Certificate.

Step 3: Attach the required documents like the sale deed, property tax receipts, and any other relevant documents.

Step 4: Pay the required fee for the certificate.

Step 5: The certificate will be issued to you within a few days.

Online Process:

To obtain it online, you need to follow the below-mentioned steps:

Step 1: Visit the official website of the concerned department or state government.

Step 2: Register yourself on the website and create a user ID and password.

Step 3: Select the ‘Encumbrance Certificate’ option and fill out the application form.

Step 4: Upload the required documents like the sale deed, property tax receipts, and any other relevant documents.

Step 5: Pay the required fee for the certificate online.

Step 6: Once the payment is confirmed, the certificate will be issued to you within a few days.

Types of encumbrance certificates

The following are the types of encumbrance certificates:

Form 15: This certificate states that the property is free from any registered encumbrances for the given period of time.

Form 16: This certificate is issued for properties that have been mortgaged with banks or financial institutions. It shows that the loan has been repaid and that there is no outstanding loan amount.

Form 13: This certificate is issued in case of a pending legal case related to the property. It provides information on the nature of the case and its status.

Form 7 and 12: These certificates are issued for agricultural properties. Form 7 certifies that there are no disputes pending in the revenue court related to the property, and Form 12 certifies that the land is not classified as a government land.

Form 10: This certificate is issued for properties that are sold through a registered sale deed. It certifies that the property has been transferred from the seller to the buyer.

Form 11: This certificate is issued for properties that are inherited or gifted. It certifies that the property has been legally transferred to the recipient.

It is important to note that the types of encumbrance certificates may vary from state to state in India.

What is a Nil Encumbrance Certificate?

A Nil Encumbrance Certificate (NEC) is a certificate issued by the Sub-Registrar’s office, which confirms that there are no financial or legal liabilities against a property for a specified period. This certificate is usually required for properties that are newly constructed or not yet occupied. It is also essential when applying for a home loan or mortgage.

What does an Encumbrance Certificate Include?

An Encumbrance Certificate contains the following details:

• Property details like the survey number, extent of the property, location, and boundaries.
• Details of the owner of the property.
• The history of the property, including past transactions, mortgages, liens, and charges.
• The duration of the certificate, which is usually for a specified period.
• The signature and seal of the issuing authority.

How to Apply Offline?

To apply for an Encumbrance Certificate offline, you need to visit the Sub-Registrar’s office in person and fill out the application form. You also need to attach the required documents and pay the required fee. The certificate will be issued to you within a few days.

How to Apply Online?

To apply for an Encumbrance Certificate online, you need to visit the official website of the concerned department or state government and fill out the application form. You also need to upload the required documents and pay the required fee online. Once the payment is confirmed, the certificate will be issued to you within a few days.

It is important to note that the process of obtaining an Encumbrance Certificate may vary from state to state, and it is advisable to check the specific requirements and procedures for your state or region.

Conclusion

Overall, an Encumbrance Certificate is a crucial document that verifies the legal status of a property and confirms that there are no financial or legal liabilities against it. It is essential for various property transactions and also helps in resolving disputes related to property ownership. Both offline and online processes are available for obtaining the certificate, and it is important to follow the specific procedures and requirements of your state or region. A Nil Encumbrance Certificate is also available for newly constructed or unoccupied properties. Obtaining an Encumbrance Certificate is an important step in ensuring the legal and financial safety of a property transaction.