A mortgage discharge is a document registered at the Land Title Office under the Land Title Act, RSBC 1996, c. 250, confirming that a mortgage has been fully paid and the lender releases its charge against the property. The lender prepares and registers the discharge after receiving full payment, removing the mortgage from the title. This typically occurs when a seller pays off their existing mortgage at completion of a sale or when a homeowner refinances.

The seller pays the mortgage discharge fee. It is the seller's obligation to deliver clear title to the buyer, and paying off existing mortgages is part of that obligation. The discharge fee appears as a deduction on the seller's statement of adjustments; buyers sometimes see it on closing documents but it is not a buyer expense.

The lender typically charges a discharge fee of $200–$350 (as of 2026-07-27 — verify current) to prepare and register the discharge document. In addition, a Land Title Office registration fee applies, set by regulation under the Land Title Act; the current fee schedule is published by the Land Title and Survey Authority (LTSA). Verify the exact amounts with your lender and the LTSA before closing.

The discharge is usually registered by the lender after the mortgage is paid in full at completion of the sale transaction. In practice, the seller's lawyer or notary ensures funds are sent to the lender at closing, and the lender then registers the discharge, often within a few business days. Verify timing expectations with your legal professional, as delays can occasionally occur.

While the lender prepares and registers the discharge document, the seller's lawyer or notary typically coordinates the mortgage payout and ensures the discharge is completed as part of the conveyancing process under the Land Title Act. It is standard practice to retain a BC lawyer or notary for real estate transactions to manage title transfer, mortgage discharge, and compliance with the Land Title Act and other statutes. Verify the legal requirements for your transaction with a BC lawyer or notary.

Typically, the seller's lawyer or notary ensures sufficient funds are paid to the lender at closing to satisfy the mortgage, and the transaction can complete even if the discharge has not yet been physically registered at the Land Title Office. The discharge is registered shortly after closing. The buyer's lawyer or notary will verify that the seller's mortgage is being paid out and will not remain as an encumbrance on the buyer's title. Confirm the closing mechanics with your BC lawyer or notary.

If a lender fails to register a discharge after full payment, the seller (or the seller's lawyer/notary) should follow up with the lender to ensure compliance with the Land Title Act. In rare cases, a court application may be necessary to compel registration or remove the discharged mortgage from title. If you encounter this issue, consult a BC lawyer or notary immediately to protect your interests and clear title.

The mortgage discharge itself is not a taxable event; it is simply the release of a lender's security interest. However, if the property sale triggers capital gains or is subject to BC's Home Flipping Tax Act, SBC 2024 (effective January 1, 2025 — verify current), other tax reporting may apply. Verify your income tax and provincial tax obligations with a licensed tax professional before closing.

The buyer does not pay the seller's mortgage discharge fee; it is deducted from the seller's proceeds on the seller's statement of adjustments. Buyers may see the line item on closing documents prepared by the lawyer or notary, but it is included for transparency and accounting reconciliation only. If you are unsure about any charge on your statement of adjustments, ask your BC lawyer or notary for clarification.

Under the terms of most mortgage agreements and the Land Title Act, the lender must register a discharge once the mortgage debt is paid in full. Delays can occur due to administrative processing, but refusal without cause is not permitted. If a lender improperly withholds a discharge, the borrower or their legal representative may need to escalate the matter; consult a BC lawyer or notary if you experience an unexplained delay or refusal.