Mortgage Discharge: Removing a Paid-Off Mortgage From BC Title

You made the final payment, or paid out your mortgage when you sold or refinanced, and you expect the mortgage to be gone. But the public record of your property, kept at the Land Title Office, can still show the lender's charge until a discharge is dealt with.

This article explains in plain terms what a discharge is, who usually handles the filing, and what to do if the lender is slow. Details differ by lender and by the kind of mortgage, so treat this as a general guide and confirm your situation with a lawyer or notary.

This article covers the law of British Columbia.

What a mortgage discharge does

A mortgage is registered against your property title as a charge.

Until that happens, a buyer, a new lender or a title search may still see the old mortgage. That is why a discharge matters even when you are certain the money has been paid.

Paying out the mortgage first

Before a discharge, the mortgage has to be paid out. If you are paying it out before the end of the term, the lender may charge a prepayment charge. FCAC says this is usually the higher of three months' interest on the remaining balance or the interest rate differential.

When you confirm that you are prepaying, the lender must give you a written statement of the charge, how it was calculated, how long it is valid and the factors that could change it. That Code does not apply to mortgages entered into for business purposes or held by borrowers who are not natural persons.

Some mortgages allow prepayment without penalty. An open mortgage does, and prepayment privileges can be used without penalty. Separately, where a mortgage is not due until more than five years after its date, the borrower may pay it off at any time after five years by paying principal, interest and three months' further interest in lieu of notice. That rule does not apply to mortgages given by corporations or certain prescribed entities.

Who files the discharge

Who prepares and signs the paperwork for ending a mortgage depends on your situation, so it is worth confirming with a lawyer; where a lawyer or notary files electronically, they sign with a Juricert digital certificate registered with the Law Society. The director of land titles may designate classes of individuals who are authorized to certify electronic documents. Lawyers and notaries are the designates under the electronic filing directions.

Lawyers and notaries with a Juricert digital certificate, registered with the Law Society, can e-sign and file most forms, but not every form. A certified document is deemed executed on the date recorded on it, regardless of when the designate signed.

If you simply paid off the mortgage, ask your lender how it handles discharges and who files them.

If the lender is slow

Delays happen. These steps are usually sensible:

• Confirm in writing that the mortgage is fully paid and ask for the lender's payout or zero-balance confirmation.
• Ask the lender, in writing, whether it has prepared the discharge and who is filing it.
• Do a current title search, or ask your lawyer or notary to, to see whether the charge is still showing.
• Keep copies of every payment record, statement and message.
• If there is no progress, ask a lawyer about your options, since the right step depends on the lender and the mortgage terms.

If the lender is not responding, a lawyer can explain whether a formal demand or a court application makes sense for your situation. That is not something to guess at.

What to do next

• Gather your mortgage statements and proof of the final payment.
• Ask the lender for a written prepayment statement if you are paying out early.
• Find out who will file the discharge and when.
• Check title after a reasonable time to make sure the charge is gone.
• Contact a lawyer or notary if a sale or refinance is coming and the charge is still on title.

Note that the Legal Professions Act, which would change how lawyers and notaries are regulated, was shown as not in force when last checked, so the Notaries Act and the Legal Profession Act still govern.

Frequently asked questions