What is a discharge of mortgage in NSW?

A discharge of mortgage in NSW is the legal process of removing a registered mortgage from a property's title after the loan has been repaid. When a bank or lender holds a mortgage over your property, that interest is registered on the title through NSW Land Registry Services. Once you repay the loan in full (on sale, refinance, or payoff), the lender must consent to the removal of that registration. The discharge is now completed electronically through PEXA (Property Exchange Australia), the national electronic lodgement network. After discharge, the title shows no encumbrances from that lender.

When does a discharge of mortgage happen in a property sale in NSW?

In a property sale, the discharge of mortgage occurs simultaneously at settlement. Your conveyancer books settlement through PEXA, and your lender's mortgagee practitioner joins the settlement workspace. At the agreed settlement time, the buyer's funds are electronically transferred, your mortgage is discharged, and the transfer of title to the buyer is lodged with NSW Land Registry Services - all in one coordinated transaction. You cannot manually discharge a mortgage before settlement and sell the property separately; the two steps happen together in electronic conveyancing.

How long does a mortgage discharge take in NSW?

The discharge itself happens instantly at settlement through PEXA. However, preparing for discharge requires lead time. You or your conveyancer must contact your lender to obtain a discharge authority and book the lender's participation in settlement. Most lenders require 5 to 15 business days notice to prepare discharge documents and attend settlement. Your conveyancer will contact your lender as soon as a settlement date is confirmed. Delays are common if the lender is not notified promptly or if there are administrative issues with the discharge authority.

What is a discharge of mortgage in a refinance?

When you refinance, you replace your existing loan with a new loan from a different (or the same) lender. On refinance settlement, your new lender's funds pay out your existing loan, and your existing lender discharges their mortgage. Simultaneously, your new lender registers a new mortgage on the title. This is coordinated by your conveyancer through PEXA. Refinancing involves two transactions at settlement: a discharge of the old mortgage and registration of the new mortgage.

What happens if I pay off my mortgage without selling?

If you pay off your mortgage in full while continuing to own the property, your lender should process a discharge of mortgage. However, many lenders do not proactively remove the mortgage from the title after payoff unless you specifically request it. You should contact your lender to obtain a discharge authority and then arrange for a conveyancer to register the discharge with NSW Land Registry Services. Until the discharge is registered, the title technically still shows the mortgage even though the loan is repaid.

Discharge of Mortgage NSW: What It Is and How It Works

Q: How much does a mortgage discharge cost in NSW?

Mortgage discharge costs in NSW typically include: (1) a lender discharge fee charged by your bank, usually $250 to $500 depending on the lender; (2) a NSW Land Registry Services discharge registration fee (see the current fee schedule at nswlrs.com.au); and (3) your conveyancer's time for coordinating with the lender's solicitors in PEXA, usually included within their standard conveyancing fee. Check your mortgage terms for the exact lender discharge fee, as it varies significantly between lenders and loan types.

If you are selling a property with a mortgage, refinancing, or have paid off your home loan, you need a discharge of mortgage. Here is what it is, when it happens, what it costs, and how your conveyancer manages it.

General information about NSW property law and conveyancing practice. It is not legal advice. For advice specific to your transaction, speak with a licensed conveyancer or solicitor.

What is a discharge of mortgage?

A discharge of mortgage is the legal removal of a lender's registered mortgage from a property title in NSW. When you take out a home loan, the lender registers a mortgage over the property as security under the Real Property Act 1900 (NSW). That registration appears on the title and gives the lender rights over the property while the loan exists.

Once the loan is repaid, the lender must release their interest. This is done by registering a Discharge of Mortgage with NSW Land Registry Services (NSW LRS). The discharge removes the encumbrance from the title, leaving it unencumbered by that lender.

In NSW, nearly all residential property settlements now use PEXA (Property Exchange Australia), the national electronic lodgement platform. In PEXA, the discharge is lodged electronically at settlement, simultaneously with the transfer of title to the buyer (in a sale) or the new lender's mortgage (in a refinance).

When does a mortgage discharge happen?

On sale of the property

In a property sale, the discharge happens at settlement. Your conveyancer books settlement through PEXA, and your lender's mortgagee practitioner joins the same settlement workspace. At the agreed settlement time:

The buyer's funds transfer electronically to your account (net of the mortgage payout and conveyancing costs)
Your existing mortgage is discharged from the title
The transfer of title to the buyer is registered with NSW LRS

All three steps happen simultaneously in the PEXA settlement. You cannot discharge the mortgage before settlement and sell the property separately in an electronic settlement environment.

On refinancing

When you refinance, your new lender's funds pay out the existing loan at settlement. At the same moment:

Your old lender's mortgage is discharged
Your new lender's mortgage is registered on the title

Your conveyancer or solicitor coordinates both transactions through PEXA. The net effect: the title shows the new lender's mortgage and no trace of the old one.

After paying off the loan while keeping the property

If you repay your mortgage in full without selling, many lenders do not automatically discharge the mortgage from the title. You should request a discharge authority from your lender. Once the authority is issued, a conveyancer can register the discharge with NSW LRS. Until registered, the mortgage technically remains on the title even though the loan is repaid.

How much does a mortgage discharge cost in NSW?

Cost component	Amount	Paid to
Lender discharge fee	$250 to $500 (varies by lender)	Your bank or lender
NSW LRS discharge registration fee	See NSW LRS fee schedule	NSW Land Registry Services
Conveyancer coordination fee	Usually included in standard conveyancing fee	Your conveyancer

Source for registration fee: NSW Land Registry Services fee schedule (current 2026-27 fee schedule). Check your mortgage documents or contact your lender for their specific discharge fee, as it can range from $0 (some lenders do not charge) to over $500.

How long does a mortgage discharge take?

The electronic discharge itself is instantaneous at settlement through PEXA. The lead time is the constraint: you or your conveyancer must notify your lender and obtain a discharge authority before settlement can be booked. Most lenders require 5 to 15 business days to prepare and participate in an electronic settlement. Some lenders (particularly smaller lenders or credit unions) can take longer.

Your conveyancer will contact your lender as soon as a settlement date is confirmed. If the contract specifies a short settlement period (e.g. 21 days), early notification of the lender is important to avoid delays.

What your conveyancer does

Coordinating the mortgage discharge is a standard part of the conveyancing process for sellers and refinancers. Your conveyancer will:

Notify your lender of the settlement date and request discharge authority
Confirm the payout figure (the amount needed to repay the loan in full)
Set up the PEXA settlement workspace and invite the lender's mortgagee practitioner
Coordinate with the buyer's conveyancer (on a sale) or new lender (on refinancing) to synchronise the settlement
Confirm settlement completion and that the discharge is registered

Scenarios: discharge of mortgage in different situations

Situation	What happens to the mortgage?	Who initiates discharge?
Selling property with mortgage	Discharged at settlement from proceeds	Your conveyancer notifies lender
Refinancing with a new lender	Old mortgage discharged, new mortgage registered at same settlement	Your conveyancer and new lender's solicitor
Selling with no mortgage (unencumbered)	No discharge needed	n/a
Paying off loan while keeping property	Discharge not automatic -- must be requested and registered	You contact lender; conveyancer registers
Deceased estate sale with mortgage	Discharged at settlement from proceeds; executor deals with lender	Estate solicitor or conveyancer notifies lender

Common questions

Can I sell before the mortgage is discharged?

In practice, yes -- settlement handles it. The mortgage does not need to be discharged before you sign a contract for sale. The discharge happens at settlement. As long as your lender participates in PEXA settlement (which almost all major lenders do), the discharge and the title transfer happen simultaneously on the agreed settlement date.

What if I have two mortgages on the property?

If two mortgages are registered on the title (e.g. a first and second mortgage, or a loan and a line of credit), both must be discharged at settlement. Each discharge attracts a separate NSW LRS registration fee (see the current LRS fee schedule). Your conveyancer will coordinate with both lenders.

What if settlement is delayed after the discharge authority is issued?

Discharge authorities from lenders typically expire after 30 to 90 days. If settlement is delayed beyond the authority's validity period, a new authority must be issued (which may involve updated payout figures and additional fees from the lender). Your conveyancer will manage this if it happens.

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Conveyancing Explained provides general information about property transactions in Australia. It is not legal advice and does not create a client relationship. For advice on your situation, engage a licensed conveyancer, settlement agent, or property solicitor in your state or territory.