Financing change statement (PPSA amendment and discharge)

When a seller’s lender is paid out at closing, check how its registration will come off the record. In Ontario, discharge is done by registering a financing change statement (s. 55), and once the obligations are performed s. 56(1) lets a person with an interest in the collateral demand one. A buyer’s search after closing is where the result shows, so the discharge is something to confirm rather than assume. See how re-registration works after buying financed equipment.

What it can do

• Discharge or partly discharge a registration (Ontario s. 55)
• Extend a registration before it ceases to be effective (Ontario s. 52); BC allows renewal by registering one before the registration expires
• Record that the secured party assigned its interest (Ontario s. 47)
• Amend a registration, and in BC disclose that a secured party subordinated its interest

What to confirm at closing

Ask whether the lender will register a total or only a partial discharge, and who files it. Ontario (s. 56) and British Columbia (s. 50) each let certain persons demand an amending or discharging change statement from a secured party in stated circumstances; read those sections for who may demand and when. The base record is the financing statement.