Explained – Basics of Encumbrance Certificate

Before buying a house/property, it is essential to get all the crucial papers or documents related to the house from the previous owners. Along with that, what is equally important is to ensure that the genuine owner sells the property and there are no pending legal or financial liabilities pending on the house. To get answers about these speculations, one needs to acquire an encumbrance certificate.

What is an Encumbrance Certificate?

The word Encumbrance means a hindrance or constraint- Something which is preventing you from doing your accomplished task. An encumbrance certificate is thus a legal document which gives free legal ownership to the individuals. It means that the property has no legal or financial constraints. It is not used by the previous owner to pledge it as a security for any mortgage.

What are the details mentioned in an Encumbrance Certificate?

When you apply for an EC online , you would be provided with any of these two forms.

Form 15: If there are any pending dues or mortgages on the property, then you will be provided with a Form 15. Form 15 lists all the encumbrances which are registered on the property for the given period.

Form 16: In case, there are no pending liabilities on the property, the sub-registrar will issue you a NIL- Encumbrance Certificate which means that the property is free from any legal or financial burdens. In such a circumstance, you will get Form 16.

How can you get an Encumbrance Certificate:

  • In states such as Andhra Pradesh, Telangana, Tamil Nadu, Kerala, Karnataka, Gujarat, Orissa and Pondicherry, you can apply for an Encumbrance Certificate online. To apply for the EC, you need to fill the application form 22. The form is available on the official website of the respective state’s land registration portal. As you visit the website, find the option “Apply EC” and then submit the form and click on the save/update button.
  • You also need to enter the period for which you want the EC. Submit the necessary EC fee with the documents required. You must know that the fee for getting a non-encumbrance certificate starts from Rs. 100 and it may vary from state to state. You will then redirected to the ‘Acknowledgement’ window, and you can now view/print the encumbrance certificate.

 Applying for an EC offline: If you don’t have an internet facility or you are residing in any other city apart from mentioned above you can apply for an EC offline as well. To apply for an EC, you need to go to the sub-registrar office where the property was registered. Similarly, Fill Form 22 and submit the required documents and fees for getting an EC. In the form you need to submit all the crucial information related to property. Thus, you must have a know-about details such as name and ownership of property etc. Also, don’t forget to carry all the property papers.

Why do you need an Encumbrance Certificate?

You would require to obtain an Encumbrance Certificate in the following scenarios:

  1. When you buy a new property: When you purchase a new house/property, you need to ensure that the owner is genuine and also want to know that there are no pending liabilities on the property. Further, an encumbrance certificate will also provide information about all the previous owners of the property.
  2. Mutation of property: To transfer the ownership of the property from one individual to others, you would require an Encumbrance Certificate.
  3. Withdrawing money from Provident Fund: If you are withdrawing funds from your PF account to purchase a new house, then employers may ask to submit an EC.
  4. Taking a home loan from a bank: Banks and financial institutions also ask you to submit an encumbrance certificate for a period ranging 10-15 years to ensure that there are no pending mortgages on the property.
  5. Selling the property: In case you decide to sell the property, you would need to get an EC, to provide it to the new owner of the property.

Summary:Explained – Basics of Encumbrance Certificate

An encumbrance certificate is thus legal document which gives free legal ownership to the individuals. It means that the property has no legal or financial constraints.When you apply for an EC, you would be provided with any of these two forms.

Form 15: If there are any pending dues or mortgages on the property, then you will be provided with a Form 15.

Form 16: In case, there are no pending liabilities on the property, the sub-registrar will issue you a NIL- Encumbrance Certificate .In such a circumstance, you will get Form 16.

How can you get an Encumbrance Certificate:

  • In states such as Andhra Pradesh, Telangana, Tamil Nadu, Kerala, Karnataka, Gujarat, Orissa and Pondicherry, you can apply for an Encumbrance Certificate online. To apply for the EC, you need to fill the application form 22. The form is available on the official website of the respective state’s land registration portal.
  • If you are residing in any other city apart from mentioned above you can apply for an EC offline as well. To apply for an EC, you need to go to the sub-registrar office where the property was registered. Similarly, Fill Form 22 and submit the required documents and fees for getting an EC.

You would require to obtain an Encumbrance Certificate when you purchase a new house/property, to ensure that the owner is genuine and also want to know that there are no pending liabilities on the property. Banks and financial institutions also ask you to submit an encumbrance certificate for a period ranging 10-15 years to ensure that there are no pending mortgages on the property.

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