Questions and answers: Cambridge Building Society transfer of equity
- I currently have a joint Cambridge Building Society mortgage with my brother and am investigating the option of him assuming responsibility for the whole mortgage and removing myself from it, to enable me to buy a property with my fiance. The outstanding mortgage is approx 200k, and the property value is in the region 600k. Is this a transfer of equity? Is stamp duty due?
- Can I transfer the equity held in my property with my Cambridge Building Society home loan?
- What is the process for adding or subtracting names (transfer of equity) to or from my Cambridge Building Society mortgage account?
- I am trying to find a conveyancing solicitor to deal with my transfer of equity. Cambridge Building Society have been approached for a refinancing. I considered asking my financial adviser. I am lead to believe he will likely get a referral fee for recommending a firm, but also of benefit will be that he knows the lawyer, has dealt with them before. Is my logic misguided?
- I am filling out a Cambridge Building Society transfer of equity application and have arrived at the section that asks about defaults etc. I do some debts that I have been paying off since 2009, in fact they no longer remain my credit rating. Must I set these out?
- I am hoping to remortgage my home in Rye
moving from Skipton to Cambridge Building Society. The flat is jointly owned but intend for it to be in my sole name once I switch. My former partner is OK with this and is happy to transfer equity but neither of us want to incur conveyancer charges.
- I got divorced two years ago. For some reason I never got around to change the ownership from both our names to my sole name. I am ready to do that and so is she. Transfer-of-equity is needed. Cambridge Building Society is content to transfer the full equity in my name (affordability checks done). Does my ex need a conveyancer?
Sample of information requested in a conveyancer form relating to Cambridge Building Society Transfer of Equity
Please let us know of you wish us to draw up a Declaration of Trust. If so are you happy to incur the further fee (beyond the Transfer of Equity fee)?
Has consent been obtained from Cambridge Building Society to the proposed transfer of equity?
Where you are intent on holding the property as beneficial Tenants in Common in unequal shares, what is the split to be. For e.g. 50-50, or 60-40?
Please give the name(s) and addresse(s) of anyone to be added to the title deeds?
We need you to supply the National Insurance Number(s) of all the new owners (required for submission of the Stamp Duty Land Tax Form)
Who will be responsible for the costs of the Transfer of Equity?
Caveats to be read in further to the above Cambridge Building Society transfer of equity Info :
Tax and Legal
There may be various tax and legal implications when transferring equity for your property. You should always seek the advice of a solicitor on the Cambridge Building Society conveyancing panel and accountant before transferring equity.
Transfer of Equity Conveyancing for Leasehold titles
If your property is leasehold, the lease may require that you have a license to do so from the landlord. If such terms are not adhered to 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 pursuant to 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 Cambridge Building Society 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 Cambridge Building Society 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 market value of the property at finalisation of the transfer of equity conveyancing.
If you do not keep up the payments on your mortgage with Cambridge Building Society your property may be repossessed.
Preparing the Transfer of Equity with a Cambridge Building Society Mortgage
When it comes to preparing the the Land Registry documents your conveyancing solicitor should in the ‘consideration’ panel choose the first option, if consideration is given; otherwise ignore the consideration panel altogether.
If Cambridge Building Society 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 does not constitute 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.
