What is the Stamp Duty for MODT registration in Karnataka?

MODT Stands for MEMORANDUM OF DEPOSIT OF TITLE DEED

MODT applies to all home loan borrowers. It is an undertaking by the borrower to deposit the property's title documents with the bank in exchange for a loan. MODT consists of information about the lender, borrower, loan amount, property schedule, and list of title documents.

For most banks, apart from the loan agreement and collating the property documents, the MODT needs to be registered in a sub-registrar's office by paying required Stamp Duty & Registration fee

Following are charges for MODT registration

• Stamp Duty: 0.5% of loan amount
• Registration fee: 0.1% of loan amount

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Let me share my experience of paying MODT charges

My client took a home loan of Rs. 90 Lakh from Punjab National Bank in Delhi to fund a property purchase in Bangalore. We highlighted the loan amount in below MODT for your reference

To register the above MODT in a sub-registrar office in Bangalore, we need to pay the following charges:

• Stamp Duty is 0.5% of loan amount that is Rs.90 lakh*0.5% = 45,000
• Registration fee is 0.1% of loan amount is Rs.90 Lakh*0.1%=9000
• Scanning Fee (Rs.35*7 pages): Rs.245

Total Rs. 54,245

As per my client, the maximum cap for MODT registration in Delhi is Rs.25,000 irrespective of loan amount. But in Bangalore, we don’t have such maximum cap on MODT charges, the total charge of Rs. 54,245 seems high for my client. My client wants to ignore the MODT registration and only collate the property documents with Punbaj National Bank (PNB) to avoid this cost. But PNB didn’t accept only collateral; rather they instructed us to register the MODT and obtain updated Encumbrance Certificate (EC) to release the loan amount

My client wished she could have communicated with PNB during the initial stage of the loan process to make them agree to avoid the MODT registration. Since our loan is already sanctioned and in final stage of loan disbursement, my client was not able to convince the PNB to avoid the MODT registration

So, we decided to proceed with registration and paid the MODT charges through Netbanking, refer to the below payment receipt,

We registered MODT in a sub-registrar office in Bangalore, refer to below registered MODT

We extracted the Encumbrance Certificate (EC), and we highlighted the PNB name in below EC for your reference

My client handed over the above EC, registered MODT, title documents to PNB and collected the Loan amount

Although we try to cut the MODT cost but banks don’t support it because MODT registration prevents fraudulent practices like availing loans from multiple banks on the same property or selling the property that is already mortgaged

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We assist MODT registration, please Whatsapp to +91-97424-79020

Thank you for reading…