Welcome back to The Conveyance Desk.

In Episode 11, we discussed the first ninety days after transfer. Today, we're looking at the seller's side of a mortgaged property sale—how mortgages are released, how banks are involved, and where transactions commonly encounter delays.

The Settlement Figure

The process starts with obtaining a settlement statement from the bank. This document confirms the amount required to clear the mortgage, including the outstanding loan balance, accrued interest, and any applicable fees or early settlement charges.

Because interest continues to accrue, settlement figures are time-sensitive. If the transfer date changes, the amount due may also change. Always obtain an updated settlement figure before transfer day.

The Bank's Role

On the transfer date, the seller's bank must participate in the process by accepting the settlement payment, releasing the original title deed, and issuing the documents required to discharge the mortgage.

Most problems occur not because the bank refuses to cooperate, but because attendance, authority, or documentation has not been properly coordinated in advance.

Splitting the Purchase Price

In a mortgaged sale, the buyer's payment is typically divided into two parts:

• The mortgage settlement amount paid directly to the bank.
• The remaining balance paid to the seller.

The cheque amounts and payee names must be accurate. Any discrepancy can delay or prevent completion.

Understanding Net Proceeds

Sellers receive the property's net equity, not the full sale price.

The final amount available to the seller is reduced by the mortgage settlement, bank charges, and any agreed transaction costs. Sellers planning another purchase should calculate using net proceeds rather than the headline sale price.

Early Settlement Charges

Many mortgages include an early redemption fee if the loan is repaid before maturity.

The amount varies by lender and loan type and is usually shown on the settlement statement. Understanding this cost early helps sellers avoid unexpected reductions in their proceeds.

Title Deed and Mortgage Release

The original title deed is often held by the bank as security.

Some banks require advance notice to retrieve the deed from storage. Confirm in writing that the deed will be available before the transfer appointment. Without it, the mortgage release may be delayed.

Common Causes of Delay

The most frequent issues are:

• Outdated settlement figures
• Bank representatives lacking authority
• Original title deeds not retrieved in time

Most of these problems can be avoided through proactive coordination several days before transfer.

The Typical Sequence

1. Request the settlement figure.
2. Refresh the figure before transfer.
3. Confirm bank attendance.
4. Confirm title deed availability.
5. Prepare the cheque split.
6. Complete the mortgage discharge and transfer.

When everything is coordinated correctly, the mortgage is released and ownership transfers smoothly on the same day.

In the next episode, we'll look at the buyer's side of a mortgage transaction and how bank financing affects the transfer process.