How do second mortgages work in PEXA?

[BrettCS]

A second mortgage scenario is where:

a) Blue Bank is the first mortgagee, and
b) Red Bank wants to lodge a mortgage to become 2nd mortgagee on title

In SA, QLD and WA, Red Bank could simply open a standalone workspace in the role of Incoming Mortgagee, create and then lodge the second mortgage.

In order for Red Bank to lodge its new mortgage in VIC and NSW:

1. Red Bank creates a workspace in PEXA (role of Incoming Mortgagee)
2. Red Bank to invites Blue Bank to the workspace,in the role of Consentor (NSW) or CT Controller (VIC)
3. Red Bank would prepare its Mortgage document
4. If in VIC, Blue Bank would lodge a Nomination (Nomination to the PEXA Workspace and Blue Bank will request to retain control of the title)
5. If in NSW, Blue Bank would create and lodge a Third Party Consent
6. Red Bank then lodges its Mortgage

In WA, the second (incoming) Mortgagee needs to obtain the paper title from the first mortgagee. Then the second mortgagee can lodge the second mortgage via PEXA – certifying to Landgate that you hold the Duplicate CT and that it will be destroyed/invalidated for future dealings.

If a new Duplicate CT is to be issued, it needs to be advised via the Lodgement Instructions and sent via post back to the first mortgagee. 

[LG]

Hi BrettCS,

What if you want to discharge a second Mortgage?

[Ames]

Hi @LG

As the first mortgagee typically holds eCT control in Victoria, or Control of Right to Deal in NSW, the second mortgagee will require the electronic CT be "made available" for the lodgement, so in Victoria, the first mortgagee must lodge a nomination to allow the second mortgagee to discharge its mortgage. In NSW, the first mortgagee must lodge a consent.

Hope this helps,

Ames

[Ronnie]

Hi Brett @BrettCS / LG @LG / Ames @Ames ,

Hope you're all well.

How can Red Bank Discharge 2nd Registered Mortgage for South Australia Property in PEXA ?

Blue Bank (ANZ) - First Registered Mortgagee

Red Bank (WESTPAC) - Second Registered Mortgagee

(Unable to Select Role from Invite Participant tab)

Please provide alternative if PEXA currently not performing South Australia matters .

Please kindly assist .

Thank You .

[BrettCS]

Hello @Ronnie

In both QLD and SA there is neither a CoRD nor a CT Control procedure to be observed.   Hence the second Mortgagee simply discharges their mortgage. There is no requirement to invite the first mortgagee to the workspace.

Thanks

Brett

[BrettCS]

Hi All,

If you are looking to discharge a second mortgage off a title, please review the details outlined below for each state.

QLD and SA

A second mortgagee may discharge a second mortgage at any time. Both QLD and SA have no CoRD or CT Control process, hence there is no requirement to involve the first mortgagee in the PEXA workspace.

VIC

The first mortgagee on title must be invited to the workspace to create a nomination document. They nominate to the transaction, allowing the second mortgagee on title to process the discharge of mortgage.

NSW

The first mortgagee on title must be invited to the workspace to create a consent document. They consent to the transaction, allowing the second mortgagee on title to process the discharge of mortgage.

WA

A second mortgagee may discharge a second mortgage at any time. No consent, or entry of holding details is required.

Please let us know if you have any further questions around second mortgages.

Thanks

Brett

[Ronnie]

Hi @BrettCS , 

Thanks heaps for the thorough explanation . Legend !! 

[DMc]

For WA take a gander at https://www0.landgate.wa.gov.au/for-individuals/Land-Transactions-toolkit/land-titles-registration-p...

[BGoodwin]

We have two Victorian matters where we hold first mortgage and there is a second mortgage. In both matters we wish to discharge the first mortgage. In the lodgement instructions we cannot direct the eCT control to the 2nd Mortgagee. We tried lodging a Nomination saying we don't want eCT control after the transaction, however we still need to complete issuing instructions (and the 2nd Mortgagee is not one of the choices).

Are we missing something here?

Baz..... 

[TWoodland]

Hi all,
I've encountered a similar situation to BGoodwin.

• Attempting to discharge our 2nd mortgage
• 1st mortgagee invited to workspace as CT Controller, they've signed lodgement instructions & nomination
• We have now successfully signed our discharge of mortgage
• We're unable to sign our lodgement instructions, it doesn't allow us to transfer eCT to the 1st mortgagee.

Any ideas?

@BrettCS @BGoodwin 

Thanks!

[BGoodwin]

Hi @TWoodland 

I gather you're talking about a Victorian matter. Sounds OK so far. Has the Nomination been lodged? Is there an error coming up in relation to your lodgement instructions? 

Baz...

[TWoodland]

Hi @BGoodwin,

Thanks for your response. Not to worry, the 1st mortgagee has amended their nomination document and everything seems to be working now!

Thanks!