The property has been sold for $850 000 and upon issue of the section 27 and mortgage discharge the bank calls you and says there is a shortfall of $23 000 and this mortgage is also being used as a line of credit.
Aimed at conveyancers, property lawyers, mortgage specialists or any one else relevant, preferably in Australia.
Most typically the property can not change into the buyers name until all liens (and a mortgage is a lien) are resolved. Thus it is up the seller to cough up the extra cash at closing or getting the lien holders to forgive the shortfall. In most cases the lien holders aren’t willing, but there are exceptions depending on how the property is sold. If the seller and/or lien holders are unwilling the short fall becomes the responsibility of the buyer but no buyer in the right mind is going to pay more money atop the agreed upon sales price and instead will sue the seller for breach of contract.