If you have fully settled your RHB housing loan, you may be wondering what happens to the bank’s charge registered against your property.
Full settlement of the loan is an important first step, but it does not by itself remove a registered charge from the property title.
Where RHB is registered as the chargee, a Discharge of Charge will generally need to be completed and registered before the charge is formally removed.
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Why Is RHB Still Shown on My Property Title?
When a housing loan is granted for a property with an individual or strata title, the bank will usually register a charge over that property as security for the loan.
This means that even after the loan account has been fully settled, the existing registered charge remains part of the land records until the necessary discharge is registered.
A Discharge of Charge is therefore the legal step that releases the property from the bank’s registered security.
From RHB Loan Settlement to Discharge of Charge
Before the charge can be discharged, the housing loan or financing must first be fully settled.
Once the required settlement has been completed, the relevant security and discharge documentation can then be attended to.
This may involve:
- Reviewing the property title and existing charge;
- Confirming settlement of the RHB financing;
- Obtaining the relevant security and discharge documents;
- Preparing the prescribed discharge documentation;
- Arranging execution by the bank where required; and
- Presenting the discharge for registration at the relevant Land Office or Land Registry.
Form 16N – Discharge of Charge
For a registered charge under the National Land Code, the prescribed instrument is Form 16N – Discharge of Charge.
Section 278 of the National Land Code provides for the discharge of a registered charge, and Form 16N is the prescribed form used for this purpose.
Once properly registered, the discharge removes the relevant registered charge from the property title.
Why Should the Charge Be Removed?
If you have finished paying the RHB loan and intend to keep the property, completing the discharge ensures that the title properly reflects that the property is no longer subject to that registered charge.
This can also be important when you later intend to:
- sell the property;
- refinance the property;
- transfer the property to another person; or
- use the property as security for another financing facility.
Leaving an old charge on the title may mean that the discharge has to be dealt with later before another transaction can be completed.
What If There Is No Individual or Strata Title?
A Discharge of Charge is not necessarily the correct procedure for every financed property.
If the property did not have an individual or strata title when the RHB financing was obtained, the bank’s security may instead have been created through an assignment.
In such circumstances, a Deed of Receipt and Reassignment may be required following full settlement rather than a Form 16N Discharge of Charge.
Your solicitor can review the title status and original financing documents to determine the appropriate procedure.
Can I Appoint a Lawyer to Handle the RHB Discharge?
Yes.
A conveyancing lawyer can assist in coordinating the legal documentation required to discharge the charge.
This may include reviewing the title, liaising with the relevant bank department or solicitors, preparing the discharge documentation and attending to registration at the relevant Land Office or Land Registry.
Need Assistance With an RHB Discharge of Charge?
TEH & YU assists property owners with Discharge of Charge and other conveyancing matters following the full settlement of housing loans.
If you have completed repayment of your RHB housing loan but RHB’s charge remains registered against your property title, we can review your documents and assist with the necessary discharge process.
Contact us for assistance with an RHB Discharge of Charge in Malaysia.
Frequently Asked Questions
My RHB loan account has been fully settled. Is my property now free from the charge?
If RHB has a registered charge over the property, the relevant discharge will still need to be executed and registered before the charge is removed from the title.
Does the redemption statement remove the charge?
No. The redemption statement relates to the amount required to settle the financing. The Discharge of Charge is the separate legal process used to remove the registered charge from the property title.
What document is used for an RHB Discharge of Charge?
Where RHB holds a registered charge under the National Land Code, the prescribed instrument is generally Form 16N – Discharge of Charge.
What if my RHB loan was secured by a Deed of Assignment?
If the bank’s security was created by assignment because an individual or strata title had not yet been issued, a Deed of Receipt and Reassignment may be applicable instead.
Can I engage my own conveyancing lawyer?
Yes. A conveyancing lawyer can review the property and financing documents and assist with the relevant discharge or reassignment procedure. Contact us for more info.
Need Assistance With a Discharge of Charge?
If your housing loan has been fully settled and you require assistance to discharge the bank’s charge from your property title, contact us to discuss the next steps.