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How to discharge a home loan

There are a variety of reasons you might need to discharge your mortgage.

If you’re looking to discharge a home loan, there’s a specific process you’ll need to follow. Knowing that process, and the situations in which you’ll have to follow it, can save you both time and money.

What is a discharge of mortgage?

A discharge of mortgage is removing a home loan from the title of your property. When you have a home loan, the bank holds the Certificate of Title on your property until the home loan is repaid. When you’ve paid the full amount off your home loan, you need to go through a process to discharge the mortgage and remove the lender from your title.

Discharging a mortgage is an important process, particularly if you’re looking to sell your house or refinance your home loan. Failing to follow the proper steps to discharge your mortgage can end up causing delays and - potentially - costing you money.

When do you have to discharge a mortgage?

Home loans are a long-term proposition, and when you take one out it’s doubtful you’re already thinking about the logistics of discharging it. However, there are a variety of circumstances that might require you to discharge a home loan, and not all of them fall at the end of the loan term.

When you need to discharge

  • If you’re repaying your home loan
  • If you’re selling your home
  • If you’re refinancing

If you’re repaying your mortgage in full

Once you’ve paid off your entire home loan, you’ll have to go through the formal process discharging the mortgage. This includes if you have a split home loan and are paying off one part of it.

If you’re selling your home

When you’re selling your home, an existing mortgage will be listed on your title as an encumbrance. That means it has to be discharged before any settlement can occur. If you’re selling your home but want to keep your home loan for your next property, you can apply for what’s known as a substitution of security. This removes the mortgage from the title of the property you’re selling, and adds it to the property you’re purchasing.

If you’re refinancing with a different lender

When you refinance, you’re discharging a mortgage one home loan facility in order to open another, or with one lender in order to open a new home loan with a different lender. This will require a formal discharge of mortgage.

Should I keep my mortgage?

There are circumstances in which you could be better off choosing not to discharge your home loan. For instance, if you have a home loan with a redraw facility, you could benefit from keeping the loan facility open in order to access the funds. By contrast, if you discharged your home loan and found you wanted to borrow against your dwelling for another purpose, you’d have to go through the entire home loan process again.

How to I discharge a mortgage?

Discharging a mortgage is a fairly straightforward process:Compare interest only home loans 2

1. Notify your lender

Notify your lender to discuss your plans to discharge your mortgage. Your lender will then ask you to complete a Discharge Authority form. Most lenders either have the form on their site, or have an online portal for requesting the form.

2. Complete and return the Discharge Authority form

Next, complete the form and return it to your lender. If you’re selling your property, ensure you complete the form in a timely manner. It will take the lender at least 10 business days to process your request. You might want to think about completing the form in person at a branch so your lender can help you through the process.

How to fill in the CBA discharge authority form

3. Register your discharge and Certificate of Title

If you’ve repaid your home loan, the lender can either register your Discharge of Mortgage at the Land Titles office on your behalf, or they can send you both the Discharge of Mortgage and Certificate of Title to register at the Land Titles office.

Should you decide to register the Discharge of Mortgage yourself, you’ll need to know where to register and what fees are payable in your state or territory. You can find that information here:

What are the costs involved?

The costs involved will often depend on the circumstances under which you’re discharging your home loan. Depending on your situation, you may owe your lender discharge fees. It’s important to look closely at your home loan contract and communicate with your lender about what kinds of fees you could be facing.

If your home loan was a fixed rate and you’re paying it out early, you could owe break fees or penalty interest. For a look at some of the fees involved in breaking a fixed rate home loan, read our guide. Also, registering your Discharge of Mortgage and Certificate of Title can carry different fees depending on the state or territory in which you live. You can find links to the relevant fees for your state or territory in the list above.

Planning to switch mortgages? Compare your options

Rates last updated May 20th, 2018
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% p.a.
Offset account
Split account
Loan type
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Name Product Interest Rate (p.a.) Comp Rate^ (p.a.) Application Fee Ongoing Fees Maximum Insured LVR Amount Saved Short Description
3.69%
3.69%
$0
$0 p.a.
80%
Enjoy flexible repayments, a redraw facility and the ability to split your loan. Plus, pay no application or ongoing fees.
3.64%
3.67%
$0
$0 p.a.
80%
A mortgage with a competitive variable rate, limited fees and plenty of flexibility.
3.69%
3.69%
$0
$0 p.a.
70%
Pay no application or ongoing fees and get a flexible loan with the ability to split up to 6 times.
3.64%
4.03%
$0
$395 p.a.
80%
New borrowers or refinancers from another lender get a discounted rate with this package loan.
3.62%
3.62%
$0
$0 p.a.
80%
Pay no application or ongoing fees and get access to a redraw facility and flexible repayment schedule. Refinance to a UBank loan and you could get $1,000 in your USaver account (offer conditions apply).
3.64%
3.64%
$0
$0 p.a.
70%
Get a discount for keeping your LVR at 70% or below with this innovative online lender.
3.68%
3.83%
$0
$10 monthly ($120 p.a.)
80%
Get a 100% offset account to save on interest charges, and pay no application fee.
3.69%
3.71%
$0
$0 p.a.
80%
A great interest rate home loan offer with unlimited redraw and unlimited extra payments.
3.69%
4.06%
$0
$349 p.a.
90%
Package your loan with other AMP products and save on rates and fees.
3.70%
4.13%
$0
$395 p.a.
90%
Package your loan with an eligible credit card for discounts on rates and fees, and get a 100% offset account.
3.88%
4.89%
$0
$395 p.a.
95%
Low deposit home loan. Enjoy flexible repayment options while paying limited fees.
3.77%
3.81%
$200
$0 p.a.
95%
A simplified mortgage with a low interest rate and a redraw facility.
3.58%
3.58%
$0
$0 p.a.
70%
A low interest rate home loan with no application or ongoing fees.
3.69%
3.94%
$0
$248 p.a.
70%
Get a sharp rate and a 100% offset account. Borrowers must have a 30% deposit.
3.64%
3.64%
$0
$0 p.a.
70%
A basic variable home loan that offers a competitive interest rate with no application fees and no ongoing fees.
3.68%
3.69%
$0
$0 p.a.
95%
This variable rate loan offers flexible repayments and a redraw facility. Available with a 5% deposit.
3.79%
3.79%
$0
$0 p.a.
80%
Pay no application and ongoing fees with Macquarie Bank Basic Home Loan.
3.74%
3.74%
$0
$0 p.a.
80%
A basic owner-occupier home loan with a low variable rate that requires a 20% deposit.
3.69%
3.73%
$600
$0 p.a.
95%
Variable rate home loan from one of the big 4 banks. Available with just a 5% deposit.
3.79%
3.81%
$0
$0 p.a.
90%
Buy your home with just a 10% deposit, few fees and a reasonable interest rate.
3.73%
3.73%
$0
$0 p.a.
80%
Get a 100% offset account and pay no application or ongoing fees on this special variable rate for owner-occupiers.
3.71%
3.71%
$0
$0 p.a.
70%
A variable rate home loan that has a lot of flexible features. This loan has a 100% offset account.
3.74%
3.74%
$0
$0 p.a.
80%
Pay no application or ongoing fees and get access to a redraw facility and flexible repayment schedule.
3.65%
3.66%
$0
$0 p.a.
80%
This special rate loan comes with no application or ongoing fees, and offers a flexible repayment schedule.
3.78%
3.78%
$0
$0 p.a.
80%
Pay no application or ongoing fees and get access to a free redraw facility with this innovative online lender.
3.69%
4.11%
$0
$395 p.a.
80%
Save on interest with a 100% offset account and save on other ME products with this package loan.
3.89%
4.87%
$0
$0 p.a.
90%
Borrow up to 90% of the value of the property you're buying and pay no application or ongoing fees.
4.14%
4.81%
$0
$0 p.a.
80%
Pay no application fees and access a fee-free redraw facility with this fixed rate loan.
3.62%
3.62%
$0
$0 p.a.
95%
Free home and contents insurance for 1 year. Terms and conditions apply. QLD residents only.
3.99%
4.86%
$0
$0 p.a.
80%
Access a fee-free 100% offset account and pay no application or ongoing fees.
3.85%
4.05%
$0
$350 p.a.
95%
This high LVR fixed rate loan allows you to borrow up to 95% of the value of the property you're buying.
4.09%
4.11%
$0
$0 p.a.
80%
This variable rate loan keeps the features simple and fees low. This loan is offered by a 100% online lender.
3.64%
3.78%
$0
$10 monthly ($120 p.a.)
80%
Earn Velocity Points on your mortgage (for a limited time, subject to eligibility requirements). Plus, access a 100% offset account to save on interest.
4.09%
4.12%
$0
$0 p.a.
95%
Buy a home with just a 5% deposit and get flexible repayment options and a redraw facility.
3.99%
4.03%
$0
$0 p.a.
95%
Buy a home with just a 5% deposit and pay no application or ongoing fees.
3.59%
4.42%
$600
$0 p.a.
95%
Get a 1% discount for the first two years of your loan and pay no application or ongoing fees.
3.68%
3.69%
$0
$0 p.a.
90%
Get one free online redraw per month and pay no ongoing fees. Application fees are waived for loans above $150,000.
4.39%
5.42%
$300
$10 monthly ($120 p.a.)
95%
Lock in a fixed interest rate term for repayment certainty.
3.89%
4.97%
$0
$395 p.a.
95%
Get discounts on a range of Commonwealth Bank products and enjoy the option of fee-free extra repayments during the fixed term.
3.89%
4.96%
$0
$395 p.a.
95%
Refinancers can get $1,500 cashback. Conditions apply. Package your home loan with a Qantas rewards earning Amplify credit card.
3.89%
4.88%
$0
$395 p.a.
95%
Refinance from your existing loan and get a $1,250 rebate. Terms and conditions apply. Plus get discounts on a range of Westpac products.

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Credit services for Aussie Select, Aussie IQ and Aussie Optimizer products are provided by AHL Investments Pty Ltd ACN 105 265 861 Australian Credit Licence 246786 ("Aussie"), and its appointed credit representatives. Credit for Aussie Select products is provided by Residential Mortgage Group Pty Ltd ACN 152 378 133 Australian Credit Licence 414133 (“RMG”). RMG is a wholly-owned subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124 AFSL and Australian Credit Licence 234945. Credit for Aussie Optimizer products is provided by Perpetual Limited ABN 86 000 431 827 (Lender). Credit for Aussie IQ is provided by Macquarie Bank Limited ABN 46 008 583 542 AFSL and Australian Credit Licence 237502. Home loans issued by the Lender are serviced by Macquarie Securitisation Limited ABN 16 003 297 336, Australian Credit Licence 237863 (MSL).

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