The encumbrance certificate is a mandatory document used in property transactions as an evidence of free title/ownership. When buying a house, flat or plot, it is important to verify that the property does not have any monetary or legal dues. And encumbrance certificate (EC) ensures that there is a complete ownership of the property without any monetary or legal liability. The EC for property can be obtained from the sub-registrars office where the particular property has been registered.
The encumbrance certificate is important for those applying for a home loan or obtaining a loan against property or when one wants to sell or buy a property. Encumbrance means that the liabilities created on a particular property, whereby it is held as a security for any debt of its owner, which has not been discharged as on date. An encumbrance certificate contains all the transactions registered relating to a particular property for a certain period (as required). These details also consist any claims or encumbrance on the property.
Government authorities and financial institutions like banks usually demand 10-15 years of encumbrance. However, you can also ask for up to 30 years encumbrance certificate to be checked. If you still have doubts, you can take a Possession Certificate of the ownership of the particular land, which is available from the village office.