Examples of recent questions relating to First Direct transfer of equity

• My existing mortgage is with First Direct. Can I transfer equity to someone less than eighteen years old?
• Will I have to pay any charges for a Transfer of Equity where the existing mortgage is with First Direct?
• I am transferring my share of a property in Hendon to the other co-owners fiance, they are sticking with First Direct being the the existing mortgage company. We are debating as to who must pay the charges for the transfer of equity. Should this be shared or is one party liable for the charges for?
• My divorce is through as is the consent order. Now I need to sort out the transfer of equity at the land registry and the First Direct mortgage. I have contacted First Direct for the transfer of equity application. What are my next steps?
• I got divorced in 2012. I simply never got around to change the ownership from the current 'joint' status to my name alone. I now plan to deal with it and there are no objections. Transfer-of-equity is needed. First Direct is content to transfer the property and loan in my name (financial checks done). Does my ex need a lawyer?
• Have recently split up with my ex of thirty years. I'm now back with my parents again and she wishes to stay in the flat and buy me out. What portion do I get. Is it half of the equity after discharging the First Direct home loan? I assume proper valuations are required but I really need to be sure that I'm getting I am not being walked over
• First Direct yesterday agreed I can take over the mortgage on the house. I had applied for a transfer of equity but is this a transfer of ownership at the Land Registry as well?

Examples of information requested in a conveyancing solicitor questionnaire relating to First Direct Transfer of Equity

Caveats to be read in further to the above First Direct transfer of equity Questions and Answers :

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 First Direct conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold properties

If your property is leasehold, the lease may require that you have a license to do so from the landlord. If such conditions are not strictly observed you may be in violation of your covenants under 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 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 conveyancing solicitor will check with First Direct 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 First Direct 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 transaction.

Preparing the Transfer of Equity with a First Direct 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 First Direct 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 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.