No Objection Certificate

What is an NOC?

A NOC is a No Objection Certificate to mortgage the property given by the legal owner of the property to the Bank. This is required in cases where the legal owner of the property is different from the beneficial owner. Some examples are co-operative housing societies that legally own the property but the members have the right to occupy specific premises and to transfer such rights. Another case could be where the land is owned by a statutory development authority such as DDA and transfers leasehold rights to the borrower while retaining the legal ownership of the land.

The NOC certificate covers five main clauses: Property being free from any encumbrances, property being free and marketable, permission to mortgage the property, acceptance of the bank’s charge on the property, and the borrower not being allowed to transfer the property to anyone else without the consent of the Bank.