There is so much to handle with the sale of a property, whether you’re arranging the disconnection of utilities or dealing with furniture removal companies. In a nutshell, the sales process can be a very stressful time for you and your family. Your usual routine is up in the air because of home opens and inspections, then there’s the worry of price negotiations. While it’s tempting to just sit back and relax, there are tasks you must prepare for, such as arranging discharge of mortgage.
What’s involved in the Discharge of Mortgage process?
- Contacting your financial institution to notify them that you are ready to discharge the mortgage on the property you’re selling
- Provide your financial institution with completed discharge authority and associated documentation
- Notify your financial institution of the anticipated settlement date. Your bank or lender will send through a final pay-out figure, which also includes a fee for discharging the mortgage
- The pay-out figure and any other outstanding amounts will be paid upon settlement
- A Discharge of Mortgage document is provided and handed over at settlement and must be lodged
Real estate agents can assist in keeping all parties updated during the settlement process to avoid unnecessary delays.
Arranging Discharge of Mortgage
As the saying goes, if you snooze, you lose. Failing to arrange your Discharge of Mortgage may expose you to hefty penalty interest charges when your settlement is delayed.
Mosaic Settlements once handled a conveyancing transaction where a couple were downsizing to a smaller property after their adult children had left home. Their O&A clearly stipulated that settlement was due 14 days from Finance Approval.
Incidentally, the couple’s Finance Approval came through earlier than anticipated, which resulted in their settlement date being brought forward. Needless to say, a unique solution was required from Mosaic Settlements to assist the client, after we discovered that they had not started the Discharge of Mortgage process.
The Consequences of Delayed Settlement
Lucky for the couple in question, settlement was not delayed, thanks to the eagle-eyed expert staff at Mosaic Settlements. Had settlement been delayed, the client would have been liable for some heavy penalty interest charges.
The Moral of the Story
It is absolutely critical that sellers arrange Discharge of Mortgage as soon as there is an Offer & Acceptance on the property instead of waiting for the deal to go unconditional.
Did you know…
That it takes up to 10-12 business days for the Discharge of Mortgage process to complete?