This is involving a discharge of mortgage in NSW due to disposal / sale of property.
Is there a chance of successful lodgement (i.e. land registry updated status as "successful") however the Settlement process fails (i.e. the existing financier to the vendor does not receive the redemption sum)?
In the event the above occurs, does it mean that the discharge would have been effected / carried through and the vendor's financier is on an "unsecured" basis?
Is there any assurance that the vendor's financier will definitely receive its redemption sum prior to "successful lodgement" / "discharge of the mortgage"?
Your post from February 2020 came across my desk today.
The PEXA settlement engine is designed to orchestrate settlement and lodgement in such a manner that no party to a transaction is in possession of title and funds at the same time.
In this case, a Discharge of Mortgage with settlement, the Mortgagee would not be removed from title until the funds for settlement had been reserved at the Reserve Bank of Australia. The reservation is irrevocable.
The reserved funds are not exchanged until the Discharge of Mortgage has been received and Accepted by the Land Registry for lodgement.
This process is called Delivery vs Payment and is described in the PEXA Service Charter, specifically at 2.14.2 - 2.14.4