Yes, it is extremely important to inform the sub-registrar once a home loan is fully repaid, especially if the loan was registered through a Memorandum of Deposit of Title Deeds (MODT).
Let us explain this with a real-life example:
CLEARING A HOME LOAN REGISTERED AT THE SUB-REGISTRAR’S OFFICE
I availed a home loan of Rs.42,00,000 from State Bank of India (SBI) on 27th June 2016. As part of the loan process, a MODT (Memorandum of Deposit of Title Deeds) was executed and registered with the sub-registrar's office.
Once the MODT is registered, the bank’s name appears in Column No. 6 of the Encumbrance Certificate (EC). This entry serves as public notice that the property is mortgaged and the bank holds a legal claim over it.
In the EC shown below, we have highlighted the SBI loan entry under Column No. 6.
CLEARING THE LIEN
On 12th July 2023, I fully repaid the home loan and obtained both the No Objection Certificate (NOC) and the Discharge Deed from the bank.
To complete the lien removal process:
- I submitted these documents at the sub-registrar’s office.
- The Discharge Deed was officially registered, thereby nullifying the earlier MODT.
Following this, the updated EC now reflects my name again in Column No. 6, indicating that the mortgage lien has been successfully removed and full ownership is restored to me.
KEY TAKEAWAY
If your home loan was registered at the sub-registrar's office through an MODT, you must inform the sub-registrar and register a Discharge Deed once the loan is repaid. Only then is the mortgage lien officially removed from property records.
However, not all banks register the MODT. Some private lenders and non-banking financial companies (NBFCs) merely collect original title documents without registering the loan. In such cases, once the loan is repaid and the documents are returned, no action is required at the sub-registrar’s office.
NEED ASSISTANCE?
We assist property owners in removing mortgage liens registered at the sub-registrar's office across Bangalore
To avail our services, contact us:
- Email: pgnproperties@gmail.com
- WhatsApp: +91 97424 79020