Top seven questions relating to Family Building Society transfer of equity
- My dad passed away last March leaving a mortgage-free property to me and my brother equally. Having continues to reside at the premises, there was a provision in the will saying the propertycould not be sold for three years following her passing so he could reside there for a while. He now wants to remain in the house beyond the specified period. We have considered a transfer of equity. Am I right in saying we should get a valuation then he'd get a mortgage in the usual way to acquire my equity?
- My friend and I got a joint mortgage with Family Building Society on a house a couple of years ago. I am now looking to get a apartment by myself and my friend would like to buy me out. On the basis that we can settle on an amount what are the next steps? Is there likely to be any problem with Family Building Society with him being solely liable for the total mortgage rather than only part of it?
- I am looking for a conveyancer to deal with my transfer of equity. Family Building Society have been approached for a refinancing. I considered asking my financial adviser. I am lead to believe he will likely receive a referral fee for suggesting someone, but also of benefit will be that he knows the conveyancing solicitor, has dealt with them before. Any flaws you see in this way of thinking?
- How much the typical solicitors charges are for a transfer of equity? I need to transfer equity and remortgage - new loan with Family Building Society - and have been quoted Three Hundred pounds excluding VAT by Family Building Society's approved conveyancer, Is this a reasonable price?
- My former wife are looking to get a conveyancing solicitor lined up for a new mortgage with Family Building Society. Transfer of Equity conveyancing is also necessaryI have used the different comparison based websites and the results are from all over UK. Do we need to instruct a conveyancing solicitor local to us?
- What is the process for adding or removing names (transfer of equity) to or from my Family Building Society mortgage account?
- Is it possible to apply to borrow more money from Family Building Society as part of a Transfer of Equity?
Information that may be required from your lawyer could ask regarding your Family Building Society Transfer of Equity
Please provide the name(s) and addresse(s) of anyone who jointly owns the premises with you?
Please confirm the person to be removed from the title deeds will not reside at the property after completion of the Transfer of Equity?
Who will be responsible for the costs of the Transfer of Equity?
Please confirm whether you are receiving any payment as part of the Transfer or Equity and from whom and provide details of the amount?
Would you like us to prepare Declaration of Trust. If so are you happy to incur the further fee (beyond the Transfer of Equity fee)?
Where you are adding someone on to the property how do you wish to hold the property? Please provide your instructions by completing and returning a“Joint Ownership Declaration” Form.
Caveats to be read in further to the above Family Building Society transfer of equity information :
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 Family Building Society conveyancing panel and accountant before transferring equity.
Transfer of Equity Conveyancing for Leasehold premises
If your property is leasehold, 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.
If the transfer of equity is made pursuant to an Order of the Court, then Insolvency Indemnity Insurance is not required. In other situations, 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 Family 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 Family 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 is dependent on the valuation of the property at the conclusion of the transfer of equity conveyancing.
If you do not keep up the payments on your mortgage with Family Building Society your property may be repossessed.
Preparing the Transfer of Equity with a Family 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 Family 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 conveyancing solicitor should describe the transfer as ‘transfer of equity’ to assist Land Registry staff.
Information contained within 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.