Recently asked questions relating to Foundation Home loans transfer of equity
- My mum died early last year leaving a unencumbered property to me and my brother equally. He has always lived in the house, there was a provision in the will saying the propertycould not be sold for three years after her death so he could remain there for a prescribed period. He now says he would like to remain in the premises beyond the prescribed period. We have discussed a transfer of equity. Would I be right in thinking that we should get a valuation then he'd get a mortgage in the conventional way to acquire my equity?
- How much the typical solicitors fees are for a transfer of equity? I need to transfer equity and refinance - new loan with Foundation Home loans - and have been quoted £350 including VAT by Foundation Home loans's approved lawyer, Have I been over quoted?
- Can I apply to borrow more money from Foundation Home loans as part of a Transfer of Equity?
- What do I need to do when it comes adding or removing names (transfer of equity) to or from my Foundation Home loans mortgage account?
- Is it sensible to stop the direct debit for my mortgage with Foundation Home loans once a date for my remortgage and transfer of equity has been agreed?
- My friend and I got a joint mortgage with Foundation Home loans on a apartment in 2013. I am now looking to get a apartment on my own and my friend would like to buy me out. On the basis that we can settle on a price what are the next steps? Would there be any potential problem with Foundation Home loans with him being responsible for the total loan rather than only part of it?
- I got divorced two years ago. I simply never got around to transfer ownership from the current 'joint' status to just in my name. I now plan to deal with it and there are no objections. Transfer-of-equity is needed. Foundation Home loans is content to transfer the property and loan in my name (affordability checks done). Does my ex need any legal representation?
Questions that your conveyancing solicitor may ask about your Foundation Home loans Transfer of Equity
Have you approached Foundation Home loans to seek consent to 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 the same
Is the transfer of equity subject to a court order? If yes please supply a copy
Please provide the name(s) and addresse(s) of anyone to be added to the property title?
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” Form.
Please let us know of you wish us to prepare Declaration of Trust. If so are you willing to pay for the additional fee (beyond the Transfer of Equity fee)?
Important warnings to consider in in addition to the above Foundation Home loans 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 Foundation Home loans conveyancing panel and accountant before transferring equity.
Transfer of Equity Conveyancing for Leasehold titles
Should the tenure of your property be leasehold, provisions in the lease may have a requirement for notices to be served and that you obtain the consent of the freeholder. 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.
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 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 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 Foundation Home loans your property may be repossessed.
Preparing the Transfer of Equity with a Foundation Home loans Mortgage
When it comes to preparing the the Land Registry documents your conveyancer 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 conveyancer should describe the transfer as ‘transfer of equity’ to assist Land Registry staff.
Information provided 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.