Are you planning to buy a property? If so, it is important for you to know about the Encumbrance Certificate (EC). Whether it is your dream home or a future investment, it is rather crucial to know that the property you are eyeing is free from any legal issues or debts. An encumbrance certificate offers valuable insights into a property’s history. Simply put, it helps in knowing whether there is a loan or mortgage on the property.
Encumbrance certificates hold greater significance for those who are seeking a home loan, buying or selling a property, or applying for a loan. Let us know more about what an EC certificate is, why it is important, and how it helps in a transparent and hassle-free transaction process.
Anyone involved in property transactions must understand the importance of an encumbrance certificate. For instance, if you are looking for apartment projects in Kerala, it is vital to check that the property has an encumbrance certificate. Why? Let us break it down. Here are some of the key reasons why an EC is essential:
Proof of Ownership: Encumbrance certificate is necessary to show ownership title and to ensure that no other claims are on the property or the land. Hence, this helps determine if anyone else may subsequently claim legal title to the property.
Prevents Inherited Liabilities: When purchasing a property, buyers may face the risk of inheriting any existing liabilities linked to the property. An encumbrance certificate confirms the property is free from liabilities. It assures no previous owners have taken out loans against the property.
Tax Record: If property or land taxes remain unpaid for over three years, an encumbrance certificate is submitted to the panchayat or village administrator to update the tax records for the land or property.
Loan Approval: Those who are seeking a loan against property and those applying for a home loan are required to have an encumbrance certificate. This certificate confirms that the property is free of legal issues, which will help the lenders sanction the loan.
Property Mutation: When a property is sold or transferred, the mutation process ensures that the new owner’s name is officially recorded in the government records. An EC certificate helps in this process as it proves that the property is free from liabilities.
PF Money Withdrawal: An encumbrance certificate is also needed when an individual wishes to withdraw money from a Provident Fund (PF) account.
If you are looking for an encumbrance certificate, you may apply for encumbrance online or offline, depending on the state where the property belongs. Most of the states in India allow for the application of EC through online portals. However, some states still lack the ability to apply for an encumbrance certificate online and must follow a manual process. Here are some common things to look out for while applying for an EC.
The steps for applying for an encumbrance certificate online are common in most states, and slight changes are only visible in the site interface. One can visit the respective state’s land registration website and choose the option to apply for an EC. One might also need to enter all the requested details and then proceed to the payment option.
File the application by paying the specified charge. After issuing the certificate, you can download it online. To verify property ownership, it is crucial to know how to download encumbrance certificate from the official website. It is also advisable to perform an encumbrance certificate status check online to verify the property’s legal standing and identify any existing claims or encumbrances.
Some states do not offer an online application for an encumbrance certificate. In that case, visit the sub-registrar’s office where the property is listed to apply offline. You usually need to write an application on plain paper and submit it along with the properly filed Form 22. Pay the nominal fee with the application to obtain the EC.
After filing the application, the process follows the same steps as the online procedure. An inspector from the land records department might inspect all records of the stated property for a period of time. After the inspection, an EC will be provided detailing all transactions within the specified timeframe. If no transactions occurred, a nil EC will be issued.
The following are the details recorded on an EC:
It is important to remember that when you request an EC for a specific time frame, you will only receive details related to that period. The sub-register obtains the information from records, ensuring transparency and clarity in property transactions. They typically issue the certificates within 15–30 days from the application date.
In the near future, encumbrance certificates will hold even greater significance in property transactions and ownership. There is a high chance that they will become completely digital. Technological advancements will help us stay updated with regulatory changes, enhancing transparency and efficiency. Digital encumbrance certificates will streamline the application, issuance, and verification processes, making it more convenient for property owners, buyers, and financial institutions. In the future, we will likely see greater integration of the certificates with other property-related documents and databases.
If you are buying or selling a property, it is essential to have a clear understanding of what an encumbrance certificate is and why it is important in property transactions. You should also know how to apply, check the status, and download the encumbrance certificate online. Reputable builders always handle paperwork and documentation correctly, making the process easier. They ensure every step complies with local laws and regulations.
At Confident Group, we strive to make the process as smooth and convenient as possible for our customers. We dedicate ourselves to ensuring you have all the necessary documents, saving you and your family time and hassle.
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