Buying a home is a significant financial milestone, and for most homeowners, taking out a mortgage is an essential step in the process. But what happens when you’ve paid off your home loan or want to refinance? You need to discharge your mortgage. In Victoria, this process involves legal and administrative steps that ensure your property title is transferred correctly. Here’s everything you need to know about discharging your mortgage in Victoria.
What Does Discharge of Mortgage Mean?
A mortgage discharge refers to the formal process of removing the home loan registered against your property title, ensuring the lender is removed from the title once the loan is paid off. When you take out a home loan, your financial institution registers an interest in your property as security. Once you’ve paid off your loan, sold your property, or refinanced, you need to discharge the mortgage to regain full ownership of the title.
Without completing the discharge process, your lender will still be listed on the property title, even if you no longer owe them money. This can create complications when trying to sell or refinance your home, so it’s essential to ensure the discharge is completed correctly.
Do you need to discharge your mortgage?
In most cases, you should consider discharging your mortgage when:
- You’ve paid off a home loan
- Selling your property
- Refinancing with a new lender
- Removing a guarantor from the mortgage
- Swapping home loans between properties
- The death of a homeowner or foreclosure
How Do I Discharge My Mortgage?
The process for discharging a mortgage involves several steps:
- Obtain a mortgage discharge statement
- Fill out a discharge authority form
- Submit the required documents to your lender
Before proceeding, it’s crucial to review the relevant product disclosure statement to ensure you understand all the terms and conditions associated with your mortgage discharge. Here’s a closer look at each step.
What is a Mortgage Discharge Statement?
To discharge your mortgage, you must first obtain a mortgage discharge statement. A mortgage discharge statement is a document provided by your lender that outlines the final pay-out figure required to close your home loan. This statement includes any outstanding balance, interest, break costs, and other fees. The amount may vary depending on the settlement date, so it’s essential to request an updated pay-out figure if there are delays in the process.
You can request this statement from your financial institution through your relationship manager or nearest branch. It’s advisable to check your lender’s processing time, as some banks require several weeks to prepare this document.
What Does Discharge Authority Mean?
A discharge authority is the lender’s formal acceptance of your discharge request. Once your discharge form is processed, the lender will provide confirmation, allowing the property title to be transferred or updated. This step is crucial, as your lender needs to verify that all outstanding debts, fees, and conditions have been met before releasing their interest in the property.
How to Prepare and Fill Out a Discharge Authority Form
To fill out this form, it requires details such as:
- Your loan account number
- Property address
- Your contact details
- Settlement date
- Whether you are refinancing, selling, or fully paying off the mortgage
If multiple borrowers are involved, all must sign the discharge authority form. Some lenders also require a guarantor’s signature. Once the form is complete, it must be submitted to the lender along with any other required documentation.
How Much Does It Cost to Discharge a Mortgage?
The cost of discharging a mortgage varies depending on your financial institution. Most banks and lenders charge a discharge fee, which covers the administrative costs of removing their interest from the property title.
What is the Discharge Fee on a Mortgage from a Financial Institution?
As of February 2025, the mortgage discharge fee can range from $150 to $600, depending on the lender. Here are some examples of discharge fees charged by major Australian banks:
- Commonwealth Bank: Approximately $350
- ANZ: Around $160 – $300
- Westpac: Usually between $275 – $375
- NAB: Approximately $350
- ING: Around $250 – $300
Other fees may apply, including break costs if you are exiting a fixed-rate home loan early. These costs vary depending on the remaining term of the loan and the lender’s policies.
How Long Do Mortgage Discharge Papers Take?
The timeframe for completing a mortgage discharge varies depending on your lender and individual circumstances. On average, the process takes between 2 to 6 weeks. If you are selling your property, the discharge should be arranged well before settlement to ensure the lender is removed from the title without delays.
To speed up the process, ensure all required information is submitted correctly, including:
- Completed discharge form
- Signed request
- Accepted payout figure
- Any other required documents
Once the discharge is processed, you will lose access to your loan account, so it’s important to retrieve any needed information beforehand.
How Haitch Convey Helps You Discharge Your Mortgage
Navigating the discharge of mortgage process can be time-consuming and complex, but Haitch Convey is here to help. Our expert team of conveyancers in Victoria ensures that all documents are correctly completed and submitted on time, avoiding unnecessary delays in your settlement or refinancing process.
Whether you are looking to sell your home, refinance to a new lender, or pay off your existing loan, Haitch Convey provides professional conveyancing in Melbourne to ensure a seamless process for all our clients. We can liaise with financial institutions, handle legal paperwork, and coordinate with settlement agents to finalise your mortgage discharge efficiently.
Get in Touch Today
If you need assistance with discharging your mortgage, our team of experienced conveyancers will guide you through the entire process, ensuring a smooth and hassle-free experience.
Contact us now to get started on your mortgage discharge and secure your property title with confidence.
