Last updated April 3, 2024
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A Discharge of Mortgage form indicates that a borrower has fully or partially fulfilled their contractual obligations, and the mortgage can be cleared from the property title.
The parties involved in discharging a mortgage are the mortgagee (the lender), the mortgagor (the borrower), and the local land titles registry. The Discharge of Mortgage form is signed and issued by the mortgagee to acknowledge the release of any rights they have to the property.
A Discharge of Mortgage form is also known as a:
- Mortgage discharge authority form
- Satisfaction of mortgage
- Mortgage release
It is also known as a discharge of immovable hypothec in Quebec or a certificate of satisfaction in Prince Edward Island.
Due to specific provincial requirements, LawDepot’s Discharge of Mortgage form is available for all provinces and territories except British Columbia, Manitoba, and Nova Scotia.
What does it mean to discharge a mortgage?
When a mortgagee lends money for real estate, the property title is registered with the local land title registry and secured with a lien. This means the lender may seize or hold onto the property if the borrower doesn’t complete payments according to the original Mortgage Agreement.
Discharging a mortgage once it’s fully paid clears the mortgage from the property title, eliminating the lender’s potential rights to seize the property.
If you’re unsure of where or how the Discharge or Mortgage form needs to be submitted, you can find the contact details for your province or territory’s land title registry below:
It’s important to note that land title registries will have their own fees to discharge a mortgage in addition to any other costs the mortgagee might have in the original Mortgage Agreement.
Whole discharge versus partial discharge
There are different kinds of discharges when paying off a mortgage. LawDepot’s Discharge of Mortgage template allows you to create a form for a whole or partial discharge.
- Whole discharges mean a single property is under a mortgage, which is now fully paid, and the title can be cleared.
- Partial discharges are the most common when only part of a property is being discharged. For example, a partial discharge can occur when someone is subdividing their property or selling a portion of it and needs the mortgage cleared from the title.
A Discharge of Mortgage is like a signed letter from a lender saying a mortgage is clear from a property’s title. There are several instances where a mortgagor needs to request this particular form. This includes:
- When a mortgage is paid off, a Discharge of Mortgage form validates the paid debt and informs the title registry to clear the mortgage from the property title. Mortgagors should ensure they don’t have any other type of outstanding debt on the property, such as a home equity line of credit or a second mortgage, if they wish to clear the title entirely.
- When a mortgagor is selling their property, a Discharge of Mortgage form is necessary to clear the title so the borrower can transfer the property title to the new owner. In property sales that still have outstanding mortgage payments, the money from the sale may go into a trust that will allow the mortgagor to pay the mortgagee the remaining amount to discharge the mortgage.
- When a mortgagor transfers their loan to a new mortgagee, a Discharge of Mortgage is required to release the title from the original lender. This is so the new lender can place their name and lien on the title.
What if you don’t discharge a mortgage?
The lien will still be on the title if the mortgagor doesn’t discharge a mortgage after completing payments. If it’s not discharged, the mortgagor may encounter limitations, such as selling the property more promptly. It may also take more time and add more cost for anyone receiving the property to transfer the title.
LawDepot’s Discharge of Mortgage template is customizable for your needs. Simply choose the property type and location of the mortgaged property and complete the following steps in our user-friendly questionnaire:
1. Give the mortgagor and mortgagee’s details
Include the names of both parties in your Discharge of Mortgage form. Including the parties’ names as they’re written on the mortgage and registry documents is essential to help verify the discharge with your registry office.
2. Include the mortgage details
These details provide the key information land title registries need to complete your mortgage discharge. This includes:
- The registration details. How these details are named or what they include will vary between provinces and territories. For example, Ontario requires a registration date and number issued from the land title registry. However, Alberta has a mortgage instrument number. If you don’t know these details, contact your land title registry office to find out what was generated when registering the title.
- How much of the mortgage is being discharged. You can discharge the whole mortgage or create a partial discharge if clearing a portion of the property (i.e., during subdivision).
- The property details. Some provinces and territories create specific information to help identify the property, and they vary between each jurisdiction. For example, New Brunswick has a parcel identifier, and Newfoundland has a written description. You can contact your local land title registry or look at your tax assessment for the correct information.
LawDepot’s questionnaire will prompt and guide you to include the correct information to create a Discharge of Mortgage form customized for your province or territory.
3. Choose your signing date and notarization details
As mentioned before, the mortgagee must sign a Discharge of Mortgage form. If your province requires notarization to complete the discharge, our questionnaire will prompt you to select the notary’s location.
You can select a date for the mortgagee to sign and notarize the form or leave the signing details open to choose a date when they are ready to meet a notary public.
Yes, most provinces and territories require a Discharge of Mortgage form to be notarized when signing the document. Notarization validates the form and the mortgagee’s signature for your land titles registry to clear the title. LawDepot’s template provides all the details for notarization on your Discharge of Mortgage based on your location.
It’s recommended that a mortgagee has the form notarized, even if it is not required in your jurisdiction, to validate the document and ensure its authenticity.
