What is a partial discharge in mortgage terms?

A partial discharge in mortgage terms refers to a process that allows a borrower to pay off a portion of the mortgage balance while retaining the remaining amount of the loan. This typically occurs when a borrower sells a portion of the property or when they wish to disencumber a specific part, such as a unit in a multi-unit residential building.

When a partial discharge is granted, the lender formally acknowledges that a part of the mortgage is paid down and releases the borrower from that portion of the debt. However, the rest of the mortgage remains in place and is still subject to the original terms, such as interest rate and repayment period. This flexibility can be very beneficial for borrowers who want to manage their debt more effectively without fully refinancing or paying off the entire mortgage.

Understanding this process is essential for mortgage professionals, as it affects how they advise clients on managing their mortgages and financing options.