An encumbrance certificate is a property document that authenticates the ownership and indicates all transactions that have taken place concerning the property. Furthermore, it validates that the property in question is not involved in any monetary or legal disputes.
Hence, knowing an encumbrance certificate meaning is vital as many individuals tend to confuse it with an occupancy certificate. Besides, one must learn how to access this certificate to avoid any issues during property purchase.
How to get an Encumbrance certificate?
One can obtain EC from the office of the sub-register. However, it is essential to have necessary encumbrance certificate documents before applying for it. These include sales deed and property details, attested copies of address proof, property registration, among others. Upon arranging these documents, one can easily proceed to the step-by-step guide of how to apply for a loan against property.
Further, a nominal fee has to be paid for the application. Once done, the concerned officer will evaluate the indexes for information in that period.
After that, the certificate will be issued. If no transactions have taken place during that period, then a NIL Encumbrance certificate will be issued in an applicant’s name. One can get it within 15-30 days from the date the application has been made.
In addition, applicants can also choose to apply for an encumbrance certificate online due to its seamless application process. The steps are mentioned below:
- Navigate to the official website of a State’s land registration and click the option for EC.
- Enter all the essential information and then save it.
- Select the time frame of the EC and pay the required fee.
- Upon payments, applicants will be redirected to the ‘Acknowledgment’ window. After that, one can take a printout of this.
- Then, an officer from the Land Records Department will inspect the property and review all the information provided for a specific time frame.
- The encumbrance certificate will be provided after that.
Steps to track EC application status
Individuals can track their application status of this certificate by following these steps:
- Visit the official website and navigate to the Certificate section.
- Enter the transaction ID provided when you submit the application.
- Then, enter the captcha value, and after that, the certificate will be displayed on the screen. This can be downloaded in PDF format.
Once the borrower receives it, he\she can proceed to apply for a LAP loan. However, that is not all. EC is important for other reasons too, and they are discussed below.
Importance of Encumbrance certificate
Property owners must understand the significance of this certificate. Following are some instances when an individual needs to submit an encumbrance certificate:
- To purchase a property
- While applying for a LAP
- For selling the said property
- Using provident fund to purchase a property
However, along with submitting this document, debtors can qualify for a loan against property by meeting these simple eligibility criteria.
What are the benefits of applying for LAP?
This is a secured loan option that offers several benefits for its borrowers. Read on to know about the advantages provided by LAP:
Affordable interest rates
One of the primary benefits of LAP is that the interest rates charged here are more affordable compared to any other unsecured financing option. In addition, interest rates are influenced by factors such as type of property and age, a high CIBIL score, repayment tenor and others.
No end-use restrictions
This type of financial instrument allows borrowers to use their funds as per their monetary requirements. Thus, individuals can manage big-ticket expenses such as overseas education, medical expenses, and others without any worry.
Moreover, reputed lending institutions offer LAP at affordable rates with minimal documentation. Furthermore, the availability of pre-approved offers extended by leading HFCs further streamlines the loan application process and saves time. Various secured and unsecured financial products come under this offer, and individuals can check their pre-approved offer by providing their essential contact details.
Thus, getting an encumbrance certificate is necessary to prove that the property is free from any disputes before opting for a LAP.
Also Read: How Much Property Loan Can I Get?