Dual occupancy sub-division: property title question

[Morgs]

We are planning on building a detached dual occupancy at the back of a property, subdividing the two properties and selling them separately.

What I would like to know is if we have a mortgage over the original property, does it impact the subdivision process? Ie I would think the mortgage over the title would need to be lifted before the council will separate the titles? Does this mean that the mortgage will need to be paid out? If so, at what point in the sub-division process does this need to be done?

Anyone with previous experience or any info would be much appreciated.

 

[morty]

Hi Morgs,

I've done a few of these now and you don't need to pay out the mortgage, but you do need to tell the bank what you're doing so they will then have a mortgage over both titles. Let your mortgage broker or bank contact what you're up to and they'll guide you through the process.

Good luck
Morty

 

[RumpledElf]

I have amongst my large pile of paperwork here for my subdivision something to fill in and send to the bank so they can do their arcane magic with the title. I have no idea exactly what they do with it though,