“What is a Nil or Non-Encumbrance Certificate (NEC)?
Prior to buying or selling any property, it’s important to check there are no legal or financial problems going on with the property. There is a document which is called as Nil or non-encumbrance certificate that plays very important role. This certificate ensures that the property has not any debts or legal matters against it. Also, this certificate is important for both the buyer or the seller. So, if you are also someone going to buy or sell any property then this post is just for you. We are going to share everything related to Non-Encumbrance Certificate, how to apply, importance, and everything important. So, let’s get started.
What is a non-encumbrance certificate?
A NEC which stands for non-encumbrance certificate is a document issued to ensure that there are no legal or financial issues with the property. This simply means that the property is not involved with bank for a loan. With this, it also confirms that the property belongs to the person only.
Why do you need a NEC?
As discussed already, this certificate is used when you are selling or buying some property and apply for a loan against it. It is recommended that you get an NEC for somewhere between 13 to 30 years. Without this certification your application for the loan would be rejected and you wouldn’t get any loan for the same.
Benefits of NEC
Now, that we have got to know about what is NEC? Why do you need it? Now we must get to know about the benefits of non encumbrance certificate as well. Apart from certifying the property, free of any legal or financial issues, this certificate has many of the advantages such as:
1- Ownership verification
One of the important points is that it protects you from any future ownership issues. Thus, the property helps you to claim that property is free of any legal or financial problems.
2- Easy Financing
Most of the time an NEC is asked from the lenders side to approve the loan application. So this certificate helps you to get loan approval easily. It certifies that the property has a clear status.
3- Smooth transitions
With the use of NEC certificate the sale process speed up. As this certificate clarifies that the property is safe, there will be no delay or complications during the property transaction.
4- Makes your property valuable
It has been seen that the property that has got the encumbrance certificate are more valuable as they have the certificate of clear status from any legal or financial matters. This even attracts the buyers even more.
5- Legal protection
With non encumbrance certificate the risk of financial issues related to the property claims are reduced. It serves that there are no issues against this property. Another best thing about this certificate is that it offers protection against potential legal disputes.
How to get a Non encumbrance certificate?
If you are someone who wants to get a NEC certificate then here are the steps that you need to follow:
1- Get a form from your city’s tehsildar office. Fill it properly.
2- Get a Rs.2 non-judicial stamp with application form.
3- Attest your adress certificate along with the application explaining the reason why you want this certificate and attest it with the form.
4- Make sure that all of the details of the property are correct. Details such as survey number, location and some other details needs to be correct.
5- The charge for this form would be depending of the duration that you want this certificate. However, the certificate is issued in the regional language and if you want it to be printed in any other language then you will have to pay some extra.
6- The certificate will be issued for the time period from April 1 of the starting year to March 31 of the ending year.
7- The application form is required to be submitted to the sub registrar office.
8- Once you have filled and submitted the form you will receive the non-encumbrance certificate within 20-30 days.
Can you get an online copy of Non encumbrance certificate?
The online or computerized copy of NEC certificate are only available in seven states of India. The states are Telangana, Andhra Pradesh, Gujarat, Karnataka, Orissa, Pondicherry, Tamil Nadu. Other than these states you have to apply for the hardcopy of the certificate.
