What is the use of encumbrance certificate?

An encumbrance certificate is a certificate issued by the sub-register office of revenue department. An encumbrance certificate popularly knows as EC.

Encumbrance certificate is one of the vital document to verify before we buy the property. An EC helps to verify,

  • Mortgage liability
  • Court attachment
  • Ownership
  • Property schedule
  • Registration date and allotment number
  • Market price and consideration price
  • Deed type (Acquired through sale deed, gift deed or inherited)
  • History of registered transactions & change of ownerships

If the property has been encumbered with mortgage and court attachment, property has no marketing title and cannot entitle to sell.

If the property has not encumbered, it has a clear marketing title to sell & buy.

The encumbrance certificate is usually issued in 2 forms: Form 15 or Form 16

Form 15: is issued when the property has any encumbrance during the said period, Nature of encumbrance could be gift, partition, loan, lease, legality, and parties involved in dispute.

Form 16: is issued when the property doesn’t have any encumbrance during the said period. Also, know as NIL ENCUMBRANCE CERTIFICATE (NEC). Having a clear marketing title to sell.

An EC is not only helpful to verify the property while buying. It is also an important document for several other purposes. Listed below for your consideration.

  • Loan application
  • Extract the information to draft sale agreement & sale deed
  • Property tax application
  • Khata transfer application

Therefore, an EC is mandatory at every part of property dealing that could be verification, loan, drafting the deal, obtaining property tax, khata, and submitting ownership proof to tenant at the time of renting or leasing the property, etc..

One can obtain an EC for up to last 30 years,

For property verification, It's always safe to obtain the EC till current date. Only current dated EC provides up to date transactions, avoid old dated EC.

An EC looks like below image,

An EC consist of 9 columns. here is the description of each column of an EC.

In Karnataka, we provide the service of extracting EC. To opt for our service, please write to us. Our contact in our profile description google search PGN Property management, Bangalore. 

Thank you for reading…

Location: Bengaluru, Karnataka, India

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