Mortgage Release (Distrate de Hipoteca)

What Is It?

The Mortgage Release (Distrate de Hipoteca) is the document issued by the bank confirming that a mortgage loan has been fully repaid and that the mortgage registered over the property has been cancelled.

In simple terms, it is the official confirmation that your housing debt no longer exists.

What Is It For / Why Is It Important?

Property Release
Until the distrate is issued and registered, the bank still appears in the property records as holding rights over the property.
The distrate removes the mortgage from the Land Registry (Conservatória do Registo Predial).

Property Sale
If you sell the property, the buyer — and usually the buyer’s bank — will require the distrate to ensure the property is transferred free of existing debts or charges.

End of Financial Obligation
It formally confirms that you no longer have obligations toward the bank under that specific mortgage agreement.

Where to Obtain It / How Does It Work?

Request
You must request the distrate from your bank once the final loan instalment has been paid or when the mortgage is fully settled (for example, following a property sale).

Issuance
The bank may issue the document in paper format or communicate the cancellation electronically to the Land Registry.

Registration
Possessing the document alone is not sufficient.
The mortgage cancellation must be registered at the Land Registry Office — Conservatória do Registo Predial so that the Permanent Property Certificate (Certidão Permanente Predial) reflects the property as free of charges.

What Does It Cost?

Bank Issuance
Since 2021, banks are legally prohibited from charging fees for issuing the distrate.

Registry Cancellation
Registering the mortgage cancellation at the Conservatória has an administrative cost (typically around €50).
If processed during a sale deed (Escritura), this cost is usually included in the transaction process.

Timeframe

After full repayment of the mortgage, the bank generally has up to 14 working days to issue the document or complete the cancellation procedure.

Common Scenario: Selling a Property with an Outstanding Mortgage

If you sell your property while the loan is still active:

• The bank provides the distrate directly at the final deed (Escritura).

• The buyer pays the purchase price.

• Part of the amount is transferred to your bank to settle the remaining debt.

• The remaining balance is paid to you.

• The bank delivers the distrate, allowing ownership to transfer to the new buyer free of encumbrances.