What is an encumbrance certificate?

An encumbrance certificate (EC) is an important legal document that provides information about the encumbrances or liabilities on a property. It acts as proof of the property's ownership and ensures that there are no legal claims, charges, or mortgages on the property. The EC is issued by the concerned SubRegistrar's office or the Revenue Department.

The encumbrance certificate typically contains details of all transactions, such as sale deeds, mortgages, leases, or any other registered documents that affect the property. It establishes the property's history of ownership and helps verify that the property is free from any legal disputes or financial liabilities.

The primary purpose of obtaining an encumbrance certificate is to assure the buyer or any other interested party that the property they are considering is free and clear of any encumbrances. It is commonly required during property transactions, such as buying, selling, or mortgaging a property. Financial institutions also often request the EC when providing loans against properties.

To obtain an encumbrance certificate, an application needs to be submitted to the relevant SubRegistrar's office or Revenue Department along with the necessary supporting documents, such as property details, proof of ownership, and prescribed fees. The office will then verify the records and issue the encumbrance certificate for the specified period, usually covering the past 15 years.

It is important to note that an encumbrance certificate provides information about registered transactions only. It may not capture unregistered or pending transactions or any nonfinancial disputes related to the property. Therefore, conducting a comprehensive due diligence, including title verification and legal opinion, is advisable to ensure a clear and marketable title before finalizing any property transaction.