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Recently asked questions relating to Foundation Home loans transfer of equity

  • I am disposing of my share of a house in Hendon to my co-owners fiance, they are sticking with Foundation Home loans as the the existing lender. We are debating as to who must pay the charges for the transfer of equity. Should this be split or is one of us obliged to cover the costs of?
  • After three years apart I have decided to relinquish up my share of the property to my husband who is re-mortgaging with Foundation Home loans. Could this transfer of equity be done inside one month?
  • What legal advice do I need when doing a transfer of equity where the home loan is to remain with Foundation Home loans?
  • At what stage do I incur the Stamp Duty Land Tax due for the transfer of equity in my home in my name alone which is taking place at the same time as a switching mortgage with Foundation Home loans?
  • As things stand I have a joint Foundation Home loans mortgage with my step-brother and am investigating the feasibility of him taking on the whole mortgage and extracting myself from it, to enable me to buy a property with my fiance. The outstanding mortgage is in the region 200k, and the property value is about 500k. Is this a transfer of equity? Is stamp duty due?
  • Foundation Home loans have just agreed I can take over the home loan on my home. I previously applied for a transfer of equity but is this a transfer of ownership at HMLR as well?
  • What do I do if I am unhappy with the lawyer who did our transfer of equity conveyancing?

Information that may be required from your conveyancer could ask regarding your Foundation Home loans Transfer of Equity

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

Is the transfer of equity subject to a court order? If yes please supply a copy

If you are adding someone on to the title deeds how do you wish to hold the property? Please provide your instructions by completing and returning a“Joint Ownership Declaration” Questionnaire.

Please give the name(s) and addresse(s) of anyone to be added to the title deeds?

Please confirm the person to be removed from the title deeds will not reside at the property after the transfer of equity has been completed?

Who will be responsible for the costs of the Transfer of Equity?

Information to consider in further to the above Foundation Home loans 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 Foundation Home loans conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold titles

If your property is leasehold, the lease may have a requirement for notices to be served and that you obtain the consent of the freeholder. If such conditions are not strictly observed you may be in breach of your covenants under the lease. This could trigger 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 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 lawyer will check with Foundation Home loans 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 Foundation Home loans 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 Foundation Home loans.

Preparing the Transfer of Equity with a Foundation Home loans 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 Foundation Home loans 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.


Frequently asked questions relating to Foundation Home loans transfer of equity