Mortgage Discharge

A mortgage discharge is the formal legal process of removing a lender's registered interest (charge or mortgage) from a property's title once the loan is fully repaid or refinanced. In Canada, a mortgage creates a registered charge on the land title — paying off the loan does not automatically remove it. A separate discharge document must be filed with the provincial land registry by the lender. Until the discharge is registered, the lender's charge remains on title, which can complicate a future sale or refinance. FCAC's mortgage resources cover discharge rights.

This distinction matters significantly for discharge: (1) Standard charge mortgage: registered for the exact loan amount. When paid off, the discharge is straightforward — the lender registers a discharge at land registry. Relatively easy to transfer to another lender (assignment of mortgage). (2) Collateral charge mortgage: registered for up to 125% of the property value to allow future borrowing without re-registration. Cannot be transferred — must be fully discharged (and a new charge registered) when switching lenders. TD Bank, ING Direct, and some credit unions use collateral charges by default. Always ask your lender which type you have. FCAC's mortgage type guide.

Discharge fees vary by lender and province: (1) Lender discharge fee: $200–$400 charged by most lenders (sometimes called an "administration fee" or "discharge fee"); (2) Legal fees: $400–$1,000 if you use a real estate lawyer or notary to prepare and register the discharge (required in most provinces); (3) Land registry fee: $50–$150 depending on the province. In Ontario, the land registration fee for a discharge is based on the value of the property. Total discharge cost: typically $700–$1,500. On refinancing, these costs are included in your closing costs with the new lender.

After you make your final payment (or your refinancing lender pays out your mortgage), the discharging lender typically takes 10–30 business days to prepare and send the discharge documents. Your lawyer then registers the discharge at the provincial land registry, which takes an additional 1–5 business days. Total timeline: expect 3–6 weeks from payoff to registered discharge. If you are selling or refinancing, plan your timeline accordingly — a delayed discharge from the existing lender can push back your closing. FCAC's mortgage payoff guide.

If a lender fails to register the discharge within a reasonable time (typically 30 business days after receiving full payoff), you can: (1) escalate in writing to the lender's compliance or legal department; (2) file a complaint with your provincial financial services regulator (e.g., FSRA in Ontario, BCFSA in BC); (3) apply to court for an order of discharge — which you can register yourself once granted. Keep all payoff confirmations in writing. A registered but paid-off mortgage on title can prevent a sale or refinance, so act promptly if the lender delays.

A mortgage discharge statement (also called a payoff statement or payout statement) is a document from your lender showing the exact amount required to fully pay off your mortgage on a specific date, including: current principal balance, accrued interest to the payout date, prepayment penalties (if applicable), and any outstanding fees. It is different from your regular mortgage statement. You need this document when selling, refinancing, or paying off your mortgage — your lawyer or notary requests it from the lender. Lenders must provide a payout statement within a reasonable time (typically 5 business days of request). See prepayment penalty and prepayment privilege to understand what those amounts include.