Encumbrance Certificate shows a piece of evidence that whether there are any dues on property both Mortgage and Legal and the title of the property is clear and marketable or not. It contains all the transactions in respect of the said property. Encumbrance is basically a Charge / Liability / Lien which is created on the property, which is held as a collateral or security against the debt that is not cleared/paid as on date

In simple term, Encumbrance means whether the properties have any lien on them, whether attached by the court, whether mortgaged or sold etc. by the owner of the concerned property.

Suppose, the property owner deposited the title deed (property sale deed) with the bank and availed a loan, then such loans may not reflect in EC. Because in many cases such Equitable Mortage Deed is not registered with concerned sub-registrar office by lenders (banks). Hence, it is hard to find any loan on such properties.culture of continuous learning that drives sustained improved performance.

When you are verifying the property documents, even if you find EC of a few days old, then don’t trust. Because within a single day, the existing owner might sell the property to someone else and showing you the old EC. Hence, you have to be very cautious while dealing with and understanding the importance of EC.