We often work with clients who have multiple properties or who are restructuring their portfolios. One tool that can be incredibly useful in these situations is something called a discharge of security—or, more simply, discharging a property.
This is a term you might not have come across before, but it can offer a lot of flexibility and freedom if used correctly.
What Does It Mean to Discharge a Property?
When a bank holds a mortgage over your property, they also hold that property as security for the loan. Discharging a property means the bank is releasing that particular property from being used as security—either because you're selling it or because there’s enough equity in your other properties to satisfy the bank’s lending requirements.
For example, if you’ve built significant equity in two properties, the bank may be comfortable releasing a third property as security, meaning you can sell or repurpose it freely.
How It Can Create Opportunities
This strategy is particularly effective if you have multiple properties with the same bank. Let’s say you bought a few investment properties several years ago—rising property values might mean you’ve now got enough equity in two of them to remove the third from the lending mix altogether.
This opens up options:
You could sell the discharged property and retain the full proceeds.
You might use those funds for a new purchase, renovation, or to reduce other lending.
You may even decide to refinance that property elsewhere on new terms.
A Real Example: Using a Discharge to Create Flexibility
One of our clients earlier this year purchased a new owner-occupied home but also owned two investment properties. Together, we restructured her lending so that the bank held only the new home and one investment as security.
That meant we were able to discharge the second investment property, giving her full control over when and how to sell it. Now, when she goes to sell, the bank doesn’t control the proceeds—she does. She can choose whether to pay down lending or use those funds elsewhere, based on what works best for her.
Why This Might Be a Smart Move
If you’ve held property for some time and built up equity, this could be a smart way to take more control. It ensures the bank isn’t holding more security than needed and allows you to make decisions that align with your long-term goals.
Let’s have a chat and take a closer look at your current setup.