What is an Encumbrance Certificate?
The dictionary meaning of the word “encumbrance” is, ‘a claim on property or assets’ or ‘a mortgage’. An encumbrance is a legal claim on a property that affects the owner’s ability to transfer the ownership of the property. Encumbrance means whether the properties have any lien on them, whether attached by the court, whether mortgaged or sold etc. An encumbrance certificate is evidence that the property in question is free from any monetary and legal liabilities. An encumbrance certificate contains details of all transactions done on the specific property.