Changing who owes a home loan needs the lender’s agreement. It may approve a change to an existing loan or require a refinance. Transferring the property title is a separate legal step.
The process depends on whether you are separating, selling to family or dealing with an inheritance. A mortgage broker in Brisbane can help you check the loan requirements before arranging the transfer.
Are you moving your loan to a new house or a new person?
Many people confuse “loan portability” with “transferring a mortgage.”
1. Loan Portability (Moving House) This applies when you are moving, but you want to keep your existing loan.
- You sell your old home and buy a new one.
- You may be able to keep your existing loan and rate, subject to the lender’s portability conditions. Confirm what carries over before relying on it.
- You “port” the loan from Property A to Property B.
If you are moving house, please read our guide to buying and selling a home.
2. Mortgage Transfer (Changing Borrower) This applies when the property stays the same, but the owner changes.
- You want to give the debt (and the house) to someone else.
- You are buying out a partner, gifting to family, or removing a co-borrower.
- The lender must approve the borrower change and confirm whether a new loan is needed.
- Changing borrower? The sections below cover a change of borrower and ownership.
Why would you transfer a home loan?
Separation, inheritance and family transfers can all mean changing who owns the home and owes the loan.
Check the loan arrangement with the lender before agreeing to a change of borrower or ownership.
Common reasons homeowners transfer a mortgage include:
- Divorce or separation: One partner may keep the home. The lender must agree to release the other borrower, through an existing-loan change or refinance. The title transfer is a separate legal step.
- Inheritance or death: A borrower’s death can leave a surviving joint borrower or an estate responsible for the loan. Ask the lender about continuing or replacing it.
- Financial hardship: Illness or job loss can affect repayments. A partner or relative taking over still needs lender approval.
- Family transfers: Parents may sell or gift a home to their children at a favourable price. The children still need to qualify for the loan.
- Business partners separating: An investment partner may buy out the other’s share. The lender must approve the release and may require refinancing into one name.
- Changing co-borrowers: Adding or replacing a co-borrower requires the lender to assess and approve the new borrower.
With refinancing, a new loan pays out the old one. An approved change to an existing loan can work differently. Confirm the borrower’s release and title transfer separately.
Can you legally transfer a mortgage?
Your loan contract and lender’s requirements determine what happens when ownership changes. Check these before signing a transfer.
An agreement between family members does not release a borrower from the bank’s loan contract.
Check the loan and title separately
A family transfer still needs formal loan and title checks, even if no money changes hands.
Tell the lender what you want to change. It will confirm whether a variation, discharge or refinance is needed.
Lender approval is mandatory
You need the lender’s consent to release or replace a borrower. It will confirm the application and assessment required.
If a new loan is required, it pays out the existing loan. Keep written confirmation that you have been released.
The risk of informal arrangements
A friend’s informal agreement to pay your mortgage does not release you.
The bank holds you responsible until it formally releases you.
Confirm both the lender’s release and any legal title transfer.
Common transfer scenarios
The loan and title changes depend on the people involved and what they want to do with the property.
These worked scenarios show the lending and ownership questions to check.
Scenario 1: Divorce or separation (the buyout)
The Situation: John and Jane own a home with a $500,000 mortgage. They separate, and Jane wants to keep the property.
The Process:
- Loan approval: Jane needs the lender to accept that she can afford the loan on her own income. The lender may require a refinance or allow a change to the existing loan.
- The Buyout: John is removed from the title. Jane takes over the full debt.
- Costs: Jane may pay stamp duty on the transfer, though some states offer exemptions for relationship breakdowns.
LMI often applies if you have less than 20% deposit or equity. Don't assume a Family Law Court Order gives you an LMI waiver. We'd check the new loan amount, the lender's valuation and any waiver you qualify for before you rely on the cost saving.
For the full separation process, start with our divorce and separation home loan guide.
Scenario 2: Parents gifting to children (favourable purchase)
The Situation: Mary and Tom want to sell their home to their daughter, Emily. The home is worth $600,000, but they only owe $400,000. They “sell” it to her for the loan amount ($400,000).
The Process:
- Favourable Purchase: This is a discounted sale. A private arrangement may avoid selling-agent fees.
- Gift of Equity: The $200,000 difference is a “gift of equity.” Emily can often use this equity as her deposit. She may not need genuine savings.
- Stamp duty: For this whole-property transfer, duty is generally based on the higher market value of $600,000 rather than the $400,000 price, unless an exemption or concession applies. In Queensland, if Emily is a first home buyer moving in, the first home concession takes the duty on a $600,000 home to nil.
Our gifted equity guide explains how lenders treat a family sale below market value.
Scenario 3: Inheritance or death
The Situation: John passes away, leaving a home with a mortgage to his wife.
The Process:
- Notification: The executor or spouse notifies the lender.
- Existing joint loan: If the surviving spouse is already a borrower, they remain responsible for repayments. Depending on the lender, the existing loan may continue in their name or need refinancing.
- Sole loan or new borrowing: If the loan was only in John's name, the estate and lender need to agree how it will be repaid or replaced. Ask the lender's deceased-estates team what documents and assessment are needed before assuming the loan can transfer.
Note: Deceased-estate duty relief depends on the state and transfer documents. Have the estate’s solicitor confirm any exemption or nominal duty.
Scenario 4: Transfer between friends (transfer of equity)
The Situation: James and Daniel co-own an investment property. Daniel wants to cash out his share.
The Process:
- The Exit: James must buy Daniel out. He becomes the sole owner.
- Reassessment: James must prove he can service the entire loan on his single income.
- Risk: James needs an affordable arrangement. A Guarantor offering extra security does not replace affordability checks. If no suitable arrangement is available, a sale may be needed.
This is technically a “Transfer of Equity.” Ownership structure changes (e.g., from Joint Tenants to Sole Owner), requiring a full credit reassessment.
Scenario 5: Transferring to a family trust or company
The Situation: You want to move your personal home into a Family Trust or Company. This is often done for asset protection or advanced tax planning.
The Process:
- The Sale: It is treated as a sale. You essentially “sell” the property to the Trust or Company entity.
- New Loan: The lender assesses the trustee or company as borrower and confirms any personal guarantees required.
- Warning: Some lenders may view this as a commercial transaction. This means loan terms, fees, and interest rates might differ from standard residential loans. Talk to your accountant and solicitor, as well as your broker, before moving your home into a trust. You can lose the main residence CGT exemption. Ask them to check duty and land tax for your state and trust.
Check to see if you are eligible for a home loan
The transfer process, step by step
A borrower change needs lender approval; a title change also needs the appropriate legal documents.
Step 1: Speak to a mortgage broker
Check your current lender’s options as well as alternatives.
We’ll check whether your current lender allows a borrower change or needs a refinance, then compare the costs. Your solicitor or conveyancer can confirm any duty exemption.
Step 2: The lender’s assessment
If a refinance or new loan is required, the person taking over needs to apply and qualify. The lender may have a separate process for removing a borrower from an existing loan.
The lender assesses income, debts, and credit history. They must comply with Responsible Lending laws.
- Ensure the new borrower can afford the debt alone.
- The Outcome: Approval for the change to the existing loan, or conditional approval for a new loan that pays out the old mortgage.
Step 3: Prepare legal documents
I’d have a solicitor or conveyancer prepare the transfer documents and check the legal requirements.
They will draft the Transfer of Land document or a Contract of Sale.
Even a gift needs formal transfer documents. Your solicitor or conveyancer handles the duty assessment and title registration.
Step 4: Valuation and unconditional approval
The lender may need a property valuation.
They need to confirm the home’s current market value. This determines your Loan to Value Ratio (LVR).
If the lender approves the application, it issues the loan or variation documents and explains any remaining conditions.
Step 5: Settlement day
For a refinance with a title transfer:
- Discharge: The old mortgage is paid out and closed.
- Registration: The new mortgage is registered on the title.
Title Update: The Land Titles Office updates the official ownership records.
The registered title and approved loan documents record the final ownership and borrowing arrangements.
Two ways to structure the transfer
1. Transfer of Equity (The “Add-On”)
This is common when adding a spouse or removing an ex-partner.
- What it is: An ownership interest is transferred, such as adding a partner or removing a co-owner. The lender separately decides how the loan must change.
- You might handle this as a single transaction without a full open-market marketing campaign.
- The Result: The lender may allow a change to the existing loan or require a refinance.
2. Sale and Purchase (The “Clean Break”)
This is best for fully removing yourself or selling to a third party.
- What it is: You formally “sell” your share to the other person.
- The Price: The sale usually happens at market value or the loan balance amount.
- It triggers a clear settlement process. The sale documents and lender’s release need to deal with each party’s obligations.
Costs and timeline to transfer a mortgage
The timing depends on the loan and title changes required.
Allow 4 to 8 weeks as a planning estimate for a refinance with a title transfer; confirm timing for your application.
For a refinance, allow time for document checks, valuation, loan documents and conveyancing. An existing-loan change may follow a different timetable.
Example timeline for a refinance and title transfer
- Weeks 1 to 3 (application): We discuss your goals, submit the new application, and gather your payslips.
- Weeks 2 to 4 (assessment): The lender orders a property valuation and conducts credit checks. If approved, they issue conditional approval.
- Weeks 4 to 6 (legals): Your conveyancer prepares the Transfer of Land. Both parties sign the mortgage documents.
- Weeks 6 to 8 (settlement): The old loan is discharged. The new loan is registered. The title officially updates.
Note: Simple “spousal transfers” may be faster, while complex divorces can take longer
Who can pay off the mortgage?
Anyone can put money into your loan account, and a parent or partner can pay it for you. That doesn't make them an owner, and it doesn't take your name off the loan. You stay liable until the lender formally releases you. If someone is helping with repayments and needs to talk to the bank, ask your lender for a third party authority form.
Major costs and fees of transferring a home loan
Stamp duty can be a major cost if the ownership transfer is not exempt
Check the one-off costs for your proposed change.
Budget for the following costs before starting.
1. Stamp duty (the big one)
Duty can apply when property ownership changes, subject to state exemptions and concessions.
Duty is generally based on the higher of the price or other value given for the transfer and the market value of the property or share being transferred. State exemptions and concessions can change what you pay.
If you transfer the whole $600,000 home to your son for $1, duty would generally be based on $600,000, unless an exemption or concession applies.
Exceptions for Spouses:
Transfers between spouses often qualify for exemptions. However, gifts to children or friends usually trigger full duty.
Stamp Duty Exemptions for Spousal Transfers
These are key checks, not a complete eligibility list. Have your solicitor or conveyancer confirm the exemption, documents and any foreign-purchaser surcharge.
| State | Relationship breakdown | Transfer between current spouses or partners |
| NSW | Exemption may apply to an eligible property settlement under section 68. | Home or intended home; equal shares after transfer. De facto partners generally need 2 continuous years together. |
| VIC | Exemption may apply where section 44 requirements are met. | Residential transfer for no consideration, with residence and other conditions. At least one partner generally must move in within 12 months and stay 12 months. |
| QLD | Exemption may apply under a qualifying family-law order or agreement. | Gift of an interest in the home; the couple must own the whole home equally afterwards and use it as their principal residence. |
| WA | $20 nominal duty may apply to an eligible relationship-breakdown transfer. | Transfer from a sole owner to equal joint ownership of the couple’s home; relationship and other conditions apply. |
| SA | Exemption may apply under an eligible family-law arrangement or another qualifying partner-transfer provision. | Exemption may apply to a transfer of the shared residence between spouses or domestic partners; the required declaration and conditions apply. |
2. Capital gains tax (CGT)
Are you transferring an investment property? You may have to pay Capital Gains Tax.
- The Rule: You pay tax on the increase in value.
- The Catch: This applies even if you gift the property. The ATO treats it as a sale at market value.
- Your home: A full main-residence exemption depends on your circumstances. Ask your tax adviser to check whether it applies to the transfer.
3. Loan break fees
Do you have a fixed-rate loan? Be careful.
Paying out a fixed loan early may trigger a break cost, potentially thousands of dollars. Ask for a current quote.
- Variable Loans: Usually have low or no exit fees.
- Discharge Fee: Your old bank may charge a few hundred dollars to close the account.
4. Conveyancing and legal fees
You need a lawyer to handle the paperwork.
They prepare the transfer documents and lodge them with the Titles Office.
- Cost: Expect to pay between $800 and $2,000.
- Who Pays: Both the “buyer” and “seller” usually pay their own legal costs.
Summary of costs
| Fee / Cost | Who Pays? | Notes |
| Stamp Duty | New Owner | Generally based on the higher of the consideration and market value of the share transferred, subject to state exemptions and concessions. |
| Capital Gains Tax | Seller | May apply to investment properties and homes that do not qualify for a full main-residence exemption. Ask your tax adviser to check your position. |
| Break Costs | Seller | May apply if a fixed loan ends early; ask for a quote. |
| Legal Fees | Both Parties | Essential for valid transfer documents. |
| Valuation Fee | New Owner | Often covered by the lender, but not always. |
Get written cost estimates before signing, including your conveyancer’s fee schedule. Update your home insurance after settlement.
Risks and opportunities for transferring a home loan
Compare the transfer costs and risks with what the change would achieve.
Risks of transferring a mortgage to another person
- Unexpected Costs: Stamp duty, CGT, and legal fees add up fast. Ignoring these can break your budget.
- Credit Liability: You remain liable until the bank formally discharges you. If the new owner defaults, the bank may chase you.
- Family Strain: Agree on the loan, payout and ownership arrangements in writing so each person understands what they are committing to.
- Regulatory Compliance: Tell the lender the actual ownership and payment arrangements, including where the funds come from.
Can I transfer my low fixed interest rate to someone else?
- The Reality: If a new loan is required, the borrower applies on the rates and terms available then.
- The Exception: Westpac may remove a borrower after separation without ending the fixed term, subject to affordability checks.
- The Cost: Ending a fixed loan early may trigger break costs. Ask the lender for a current quote.
- Ask your broker to compare the costs. We can help you see if paying the “break cost” is worth it compared to the cost of a new loan.
The opportunities of mortgage transfer
- Avoid Agent Fees: A privately arranged family sale may avoid selling-agent fees. Legal, lending and tax costs still need checking.
- Amicable Divorce Settlements: One partner can retain the family home. This avoids the stress and cost of a public auction.
- A Clean Financial Break: Confirm the lender has released you from the debt as well as completing any title transfer.
- Loan Restructuring: Compare the loan costs and repayments. Moving to one borrower can change how much the lender will approve.
- Estate Planning: Get estate-planning and tax advice before gifting property so you understand the effect on your finances and future plans.
Get advice on your proposed transfer. Mortgage brokers, lawyers, and accountants can model the specific outcomes for you. Lenders have hardship obligations under the National Credit Code, but a hardship request doesn't take anyone's name off the loan.
Would you like to learn about your situation?
Frequently asked questions about transferring home loan to another person
Before you arrange the transfer
Check these details:
- Start Early: Speak to your mortgage broker immediately.
- The Approval: The lender confirms the application and assessment required, and must agree to release a borrower.
- The Process: If refinancing, the new loan pays out the old mortgage. Your solicitor or conveyancer arranges any title transfer.
- The timeline: The 4 to 8 week range above is a planning estimate. Confirm the timing with your lender and solicitor.
- The Costs: Always budget for stamp duty and legal fees.
Do not guess the costs. Get clear legal advice before you sign anything.
Next steps and transferring your property
Start by checking the current loan and proposed ownership. Our team at Hunter Galloway can help you check the finance. Speak with our brokers about the proposed borrowers, loan amount and lender requirements.
To get started, call 1300 088 065 or book a free assessment online to see how we can help.
