What Is a Discharge Fee?

A discharge fee is required when you pay off your mortgage or switch lenders.

When you close off your home loan account with the lender due to no longer owing them any money this is called a 'home loan discharge'. There are a few reasons that you might discharge your home loan:

  • Selling your home
  • Refinancing your home loan
  • Paying off the home loan in full
  • Removing a guarantor from your mortgage

What is the process of a home loan discharge?

  1. Inform your lender that you would like to discharge your mortgage
  2. Fill in the Discharge Authority form provided by the lender and return them.
  3. Next, your lender should prepare a Discharge Mortgage document. This document must be registered with the Land Titles office, your lender usually does this on your behalf.
  4. You will pay off your loan on settlement date, whether it be via a final payment or refinancing to a new lender
  5. Your home loan account will be closed

What is a discharge fee?

A discharge fee is charged by lenders, like an exit fee. This fee covers any legal and admin fees incurred by the lender when closing off your loan. This is amongst other fees payable to the Government. It is best to check with your lender how much the discharge fee is, as this figure will vary across different lenders.

However, because of our no fee promise, Unloan doesn’t charge any discharge fees. What’s more? We don’t charge annual, application, banking, account, transaction, or late fees! (Other third-party fees may apply. Government charges may apply. Your other lender may charge an exit fee when refinancing.)

The article is provided for general information and has been prepared and provided without considering any person’s financial situation, needs or objectives. You should consider its appropriateness to your own situation before making any decisions.

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