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Questions and answers: Cynergy Bank transfer of equity

  • What legal advice do I need when doing a transfer of equity where the mortgage is to remain with Cynergy Bank?
  • I am looking for a conveyancing solicitor to undertake my transfer of equity. Cynergy Bank have been approached for a refinancing. I thought of asking my mortgage broker. I understand he will likely receive a referral fee for suggesting a firm, but also of benefit will be that he knows the lawyer, has a working relationship with them. Is my logic misguided?
  • I got divorced three years ago. I simply never dealt with the change the ownership from both our names to my name alone. I now plan to deal with it and there are no objections. Transfer-of-equity is needed. Cynergy Bank is happy to transfer the full equity in my name (financial checks done). Does she need any legal representation?
  • I am completing a Cynergy Bank transfer of equity form and have arrived at the part concerning defaults etc. I do some debts that I have been discharging for a number of years, in fact they have long since disappeared from my credit records. Must I reveal these?
  • What if my application doesn't meet Cynergy Bank lending criteria for a transfer of equity?
  • As things stand I have a joint Cynergy Bank mortgage with my cousin and am looking into the possibility of him assuming responsibility for the outstanding mortgage and removing myself from it, so as to enable me to purchase a place with my fiance. The remaining mortgage is in the region 200k, and the property value is approx 600k. Is this a transfer of equity? Is stamp duty due?
  • Is stamp duty payable when it comes to an transfer of equity with a mortgage with Cynergy Bank?

Information that may be required from your conveyancing solicitor is likely to ask about your Cynergy Bank Transfer of Equity

Please provide the details of anyone to be removed from the property title?

Please provide a copy of your National Insurance Number?

Please confirm the person to be removed from the title deeds will not reside at the property after completion of the Transfer of Equity?

Will there be any payment between the parties for the Transfer of Equity? Where this is the case, please state the amount and who is to receive what amounts

Please give the details of anyone who jointly owns the premises with you?

Has consent been obtained from Cynergy Bank to the proposed transfer of equity?

Caveats to be read in further to the above Cynergy Bank transfer of equity Advice :

Tax and Legal

There are numerous potential tax and legal implications when transferring equity for your property. You should always seek the advice of a solicitor on the Cynergy Bank conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold premises

If your property is leasehold, provisions in the lease may have a requirement for notices to be served and that you have a license to do so from the freeholder. If such conditions are not complied with you may be in violation of the lease. This could potentially result in the freeholder taking enforcement action against you.

Indemnity Insurance

If the transfer of equity is made as a result of an Order of the Court, then Insolvency Indemnity Insurance is not required. In other cases, where a property is being transferred at less than market value between joint owners, an Insolvency Act Indemnity Insurance policy may be required. This is something that that your conveyancer will check with Cynergy Bank This is because, if the outgoing party is made bankrupt in the future, their Trustee in Bankruptcy could argue that they had transferred the property in order to avoid their creditors and apply to the Court to have the transaction set aside. If this happens, it could affect your lender or a future buyer from you as they would lose the property and the lender may not get back what they have loaned to you. The Insolvency Act Indemnity Insurance policy only protects lenders such as Cynergy Bank or future buyers from you. If there is no mortgage and the outgoing owner is made bankrupt, there is a risk to you that you could lose your home if the transfer is set aside. The cost of the Insolvency Act Indemnity Insurance policy varies based on the valuation of the property at finalisation of the transfer of equity transaction.
Your property may be repossessed if you do not keep up repayments on your mortgage with Cynergy Bank.

Preparing the Transfer of Equity with a Cynergy Bank Mortgage

When it comes to preparing the the Land Registry documents your lawyer should in the ‘consideration’ panel choose the first option, if consideration is given; otherwise ignore the consideration panel altogether.

If Cynergy Bank is joining in the transfer to release someone from liability, put the release in the ‘additional provisions’ panel if someone is entering into a covenant relating to the charge, place it in the ‘additional provisions’ panel stamp duty land tax is not payable when there is no chargeable consideration for the transfer (Schedule 3, paragraph 1 of the Finance Act 2003). In the case of a transfer subject to a charge (even if the transfer is by way of gift) or if a property has been transferred for no value and there is an associated discharge, HMRC would view this as an assumption of an existing debt by the purchaser (Schedule 4, paragraph 8 of the Finance Act 2003) and stamp duty land tax may be payable if you wish you may state in the ‘additional provisions’ panel that ‘This transfer is made subject to a charge dated… in favour of…’

On form AP1, your lawyer should describe the transfer as ‘transfer of equity’ to assist Land Registry staff.

Content on this webpage is for general information and only applies to England and Wales. It should not be regarded as advice for members of the public who should contact their lawyer,mortgage broker, insurer and accountant for specific advice relating to transfer of equity. Whilst we endeavour to keep the information up to date and correct we do not make any representation or warranties of any kind about its completeness, accuracy, reliability or suitability. Any reliance you place on the information is strictly at your own risk. Lexsure will not be liable for any direct or indirect loss or damage arising out of or in connection with the use of this information.


Frequently asked questions relating to Cynergy Bank transfer of equity