Discharge

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Discharge is a term used to describe the act of paying off a mortgage. This may be achieved when reaching the end of the agreed term of the loan. Alternatively, some borrowers may make plans to discharge the mortgage early, thereby paying it off several months or even years ahead of schedule.

When you borrow the funds to help you buy a property, the bank or building society lending you the money to do so will register a charge on the property. You are the owner of the property, yet since the lender has an interest in the property, their name will also appear on the title deeds. As you continue to pay off the mortgage, you will essentially own more of the property and the lender will own less. The idea is that if you ran into problems, the lender could force the sale of the home to get their money back.

When the loan is discharged and your final payment is confirmed and complete, you should receive a letter stating this from your lender. At this stage, the lender should do the required work to ensure its name is removed from the deeds. If this does not happen, it doesn’t affect you being the owner of the property, free and clear. However, it would cause issues if you came to sell the property. A solicitor would need to sort out any problems that might occur if the lender’s name still appears on paperwork lodged at the Land Registry. This would cost the seller money. So, it is wise to check the proper steps have been taken to properly discharge the mortgage.

Discharge

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