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Category: Reconveyance Deed

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Reconveyance Deed

What is a Reconveyance (or Discharge) Deed and why is its registration important after home loan repayment?

Reconveyance Deed Registration
Reconveyance Deed Registration

Repaying a home loan is a major financial milestone for any property owner. However, the journey does not end with the final EMI. One of the most critical post-loan formalities is to ensure that the lien created by the lender on the property is removed. This is achieved through the registration of a Reconveyance Deed, also referred to as a Discharge Deed.

Understanding the significance of this deed and the documents required for its registration is essential to secure full, undisputed ownership of your property.

WHAT IS RECONVEYANCE OR DISCHARGE DEED?

A Reconveyance Deed is a legal document executed by the lending institution (such as a bank or financial institution) in favor of the borrower (property owner), declaring that the mortgage has been fully repaid and that the lien over the property is officially released.

While most banks commonly use the term Discharge Deed, others may refer to it as a Reconveyance Deed. Irrespective of the terminology, the objective remains the same: to establish that the lender no longer has any claim over the property.

WHY IS REGISTRATION IMPORTANT?

Receiving a loan closure or no-dues certificate from the bank is only the first step. The mortgage release must be formally recorded at the Sub-Registrar’s office. This ensures:

  • Removal of the lender’s lien from the property
  • Updation of the Encumbrance Certificate (EC) to reflect a clear title
  • Fully and undisputed ownership of the property
  • Smooth and hassle-free future sale or transfer

DOCUMENTS REQUIRED FOR REGISTRATION

Below is a list of documents required for registering a Reconveyance or Discharge Deed:

  • Reconveyance Deed / Discharge Deed

This is the primary document to be registered. It must be executed and signed by an authorised representative of the lender. It serves as official proof that the loan has been cleared and the mortgage is released.

  • Exemption letter:

Issued by the lending institution, this letter exempts the physical presence of the lender at the sub-registrar’s office. It authorizes the registration of the deed without the lender being present in person.

  • eKhata:

An ekhata, reflecting current ownership status.

  • Borrower’s Identity Proof

A self-attested copy of a valid government-issued identification, such as Aadhaar or PAN

  • Authorized Representative’s Identity Proof

If a representative from the lender is executing the deed, a self-attested copy of their Aadhaar or PAN must be provided for verification at the sub-registrar office.

  • Power of Attorney (if applicable)

If someone other than the borrower is completing the registration process, a Notarized Power of Attorney (POA) or authorisation letter must be submitted. The Reconveyance Deed should include the POA holder’s name and ID proof number, authorizing them to act on the borrower’s behalf.

PROCEDURE FOR REGISTRATION

  • Deed Preparation

The lender drafts the Reconveyance or Discharge Deed on standard A4-sizes paper.

  • Execution by Lender

The authorised representative of the lender signs and seals the deed.

  • Document submission

Submit the deed along with the supporting documents at the Sub-Registrar’s Office. In Karnataka, prior online application and approval are required

  • Payment of Charges

Pay the applicable Stamp Duty and Registration Fees

  • Appearance for Registration

The borrower (or POA representative) must appear in person along with the Reconveyance Deed issued by the lender and two witnesses to complete the registration.

  • Collection of Registered Deed

Once the registration is processed, the registered deed will be handed over by the registrar’s office.

A registered Reconveyance Deed is a crucial document that confirms the mortgage release and ensures the title is clear in the public record, like EC. A registered Reconveyance Deed looks like the image below

CONCLUSION

Registering a Reconveyance or Discharge Deed is not merely a procedural formality, it is an essential step in protecting property ownership after loan repayment. It ensures that the property has a clear transaction history in the encumbrance certificate and enhances the ability to transact freely with the property in the future.

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Please write to us pgnproperties@gmail.com or WhatsApp to +91-97424-79020

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Reconveyance Deed

Do I Need to Re-Register My Property After Home Loan Closure?

reconveyance deed after home loan closure
reconveyance deed after home loan closure

No, re-registration is not required.

Once you have repaid your home loan, you are not required to register the property in your name again. This is because the property is already legally registered in your name at the time of purchase.

What you do need to do, however, is remove the mortgage lien that was registered against the property when you availed the home loan.

UNDERSTANDING WITH AN EXAMPLE FROM MY ENCUMBRANCE CERTIFICATE (EC):

  • Serial No. 3 – This shows the registration of my property in my name, dated 25–10–2021.
  • Serial No. 2 – This records the home loan registration (i.e., mortgage lien), also dated 25–10–2021.
  • Serial No. 1 – This refers to the registration of the reconveyance deed on 21–08–2023, which indicates that the home loan has been repaid and the lien removed.

WHAT IS A RECONVEYANCE DEED?

A reconveyance deed is a legal document that confirms the removal of the mortgage lien from your property once the home loan has been fully repaid. This is an essential step to clear the title of the property.

KEY TAKEAWAY:

  • You do not need to re-register the property in your name after loan closure.
  • You must ensure that the reconveyance deed is registered to officially remove the lien.

We provide professional assistance in registering reconveyance deeds.
To avail of our service, please write to us:

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Reconveyance Deed

What is RECONVEYANCE DEED? How to do RECONVEYANCE DEED for a Property in India?

The RECONVEYANCE DEED refers to a document that transfers the title of a property to the borrower from the bank or mortgage holder once a mortgage is paid off

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Once the full and final settlement of dues is paid in respect of MEMORANDUM OF DEPOSIT OF TITLE DEED (MODT), the bank will issue following documents, stating that dues have been cleared and request to proceed Reconveyance deed

  • No Objection Certificate (NOC)
  • Reconveyance deed
  • Title Deed

The NOC looks like the below image on bank’s letterhead:

RECONVEYANCE DEED looks like below image:

TITLE DEED is the list of documents that you handed over to bank at the time of MODT registration, Bank will hand back those documents. TITLE DEED includes your registered deed.

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The next step is to register Reconveyance Deed in sub-registrar office:

For your better understanding, let me give a real example that how I registered Reconveyance Deed of my property in sub-registrar office,

On 13th January 2016, we registered the MODT with State Bank of India (SBI) in Mahadevpura sub-registrar office (Bangalore).

In Encumbrance Certificate: column 5 shows the executor’s name and Column 6 shows in whose favor the deed is executed.

In MODT registration, your name shows in column 5 and bank’s name shows in buyer column 6. In the below Encumbrance Certificate, we encircled the bank’s name in Column 6

On 11th November 2020, we paid the full and final settlement of MODT dues, the settlement date has been encircled in below Reconveyance Deed issue by bank

On 6th July 2022, we collected the following documents from bank

  • No Objection Certificate (NOC)
  • Reconveyance deed
  • Title deed

Following are the Government charges for Reconveyance Deed Registration (Subject to Karnataka)

  • Stamp Duty: Rs. 200
  • Registration fee: Rs. 200
  • Scanning Rs. 300 (approx)

We paid the government charges through UPI. Below is the image of payment

Below is the image of Government charge payment receipt (K2 Challan)

On 6th July 2022, we took the following documents to K R Puram sub-registrar office for registering Reconveyance Deed.

  • No Objection Certificate (NOC) issued by bank
  • Reconveyance deed issued by bank
  • Aadhar
  • Government charge payment (K2 Challan)

In sub-registrar office, the office verified the above-listed documents and approved for registration. The registering officer asked the property owner to sit at the registration counter, the officer took the biometric thumb impression, photo from webcam, and OTP authenticated.

Below is the image of registered Reconveyance Deed:

We extracted the below Encumbrance Certificate (EC) after the Reconveyance deed registration.

In Encumbrance Certificate: column 5 shows the executor’s name and Column 6 shows in whose favor the deed is executed.

In Reconveyance Deed registration, Bank name shows in column 5 and Your name shows in buyer column 6. It means that we removed mortgage lien from the registry and Reconveyance is registered.

In Below EC, we encircled the Bank name in Column 5

NOTE:

  • The Reconveyance Deed is applicable if MODT is registered with bank. Few banks just collect the title documents and don’t do MODT registration. For such cases, just collect back the title documents from bank after clearing the MODT dues. Reconveyance deed is not applicable.
  • The Reconveyance Deed should register in sub-registrar’s office within 90 days from the day bank hand over the Reconveyance deed to you. Sub-registrar office doesn’t accept deed registration if the issuing date exceeds more than 90 days (If date exceeds more than 90 days, you can ask bank to issue another Reconveyance Deed with latest date)
  • Register the Reconveyance Deed in the same sub-registrar office where the MODT was registered
  • Property owner presence is mandatory in sub-registrar office for Reconveyance Deed Registration, presence of bank’s representative is not mandatory (Just the NOC from bank is sufficient)
  • If you are not physically present to do Reconveyance Deed, you may give power of attorney(POA). Your POA holder can collect title documents from bank and do Reconveyance Deed registration on your behalf.
  • K2 challan is valid for 7 days from the day of challan generation hence complete the payment within 7 days. You have options to pay by net banking, card, UPI, and cash.
  • K2 challan is valid for 90 from the day of payment, hence complete the registration within 90 days from the day of challan payment
  • Immediately after the Reconveyance Deed registration, extract the latest encumbrance certificate for cross verification, and make sure that bank name is removed from the registry.

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In Bangalore, we provide assistance to register the Reconveyance Deed. To opt for our service, please Whatsapp to + 9 1 – 9 7 4 2 4 7 9 0 2 0.

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