Mortgage frauds are one of the biggest concerns of Indian mortgage investors. Many a time people, as well as lenders, become victims of fraudulent activities while investing in the mortgage. Such incidents are not unique when the same property is used for taking two loans at the same time from two different banks. Such activities could take place because the details regarding a property’s encumbrance were solely in the hands of the lender and the borrower.
Considering all those issues and to make the investment in mortgages more transparent, the CERSAI has been founded in March 2011. The CERSAI stands for Central Registry of Securitisation Asset Reconstruction and Security Interest of India. This is a government licenced company under section 25 of the Companies Act, 1956 with the headquarters in New Delhi. The CERSAI has majority shareholding of Central Government, Public Sector Banks and National Housing Bank.
Objective of CERSAI
The company was founded with the aim of clamping down the fraudulent activities in mortgages. The primary intention was to maintain a centralised registry of all equitable mortgages. Along with the same, CERSAI also includes all relevant information of the lender who has invested on any particular property. Both the lender’s and borrower’s details are registered in the ledger of CERSAI.
All the financial institutes are instructed to register all information regarding security interests to CERSAI. The registration of the property has to be completed within a period of 30 days of the creation of security interests.
How to Register a New Entity in CERSAI?
One can initiate the registration of CERSAI through the website of the same. The “entity registration” form is available on the website. The customer should have a digital signature to access the CERSAI portal. The filled form has to be downloaded and duly signed by authorised signatory and has to be sent to the CERSAI address. Along with the documents mentioned in the form. Once you send the registration request, you can check the progress online on the website itself.
The Fees and Charges
The registration fee of CERSAI changes from time to time. If you are trying to avail a loan from any bank, you are to pay the charge clubbed with the processing or upfront charges. The payment of CERSAI registration charge with the processing fee has been started by SBI from 1st January 2014. The CERSAI does no vary from a lander to lender. It remains the same with all lenders across the nation. The registration fee depends on the loan amount. Here is what one has to pay-
Rs. 500 + Service Tax for loans above 5.00 Lacs
Rs. 250 + Service Tax for loans below 5 lacs.
If you make delay on updating your transaction with CERSAI, you will have to pay penalty for the same.
A Step Ahead
To make the lending and borrowing more streamlined, recently the Credit Information Bureau India Limited (CIBIL) and CERSAI have joined hands. The tie-up of CIBIL and CERSAI will make the lending decision easier for the lender. Before the formation of CERSAI, many times two mortgage loans were taken on the same property from two different lenders by replicating the original deed or counterfeit title deeds. The collaboration of both will provide the lender with the facility to all details of any property by accessing the website of both CIBIL and CERSAI.