What is a discharge of mortgage?

A discharge of mortgage is a document that your mortgagee will bring to settlement to handover to the buyer’s conveyancers at settlement. It will allow the buyer to register their interest over the property after your mortgage has been removed from the title. To notify your bank that you have sold your property and start to prepare for the discharge of the loan, you will need to ask your banker for a “discharge authority” to complete and submit directly to the branch. They will then send it to their settlements team to prepare. It can take up to 14 – 21 days to discharge a mortgage so you should submit the discharge authority as soon as possible.

If you are attempting a partial discharge of your mortgage with the bank, because you have more than one property used to secure your loan repayment, then you should start the process even sooner. A partial discharge can take more than a month to complete, particularly if the bank has to order multiple valuations for the rest of the securities to recalculate their risks before they will confirm the discharge.

If you are attempting a partial discharge, make sure that you keep your conveyancing lawyer informed of your dealings with the bank so that they can prepare for settlement accordingly.