Top seven questions relating to Foundation Home loans transfer of equity
- I am selling my share of a apartment in Hendon to the other co-owners husband, they are sticking with Foundation Home loans as the the existing mortgage company. We are in heated discussion as to who must pay the fees for the transfer of equity. Is this usually shared or is one party liable for the charges for?
- My Foundation Home loans mortgage we jointly entered into with ex, he is agreeable to be removed and let me have the property. Foundation Home loans will permit the transfer of equity to my individual name. Will Foundation Home loans contact my boss to check my salary?
- At what point do I pay the Stamp Duty Land Tax due for the transfer of equity in my house in my name alone which is happening at the same time as a switching mortgage with Foundation Home loans?
- My decree absolute is through as is the consent order. Now I need to deal with the transfer of equity for the property and the Foundation Home loans home loan. I have contacted Foundation Home loans for the transfer of equity forms. What happens next?
- Me and a friend got a joint mortgage with Foundation Home loans on a apartment about a year ago. I am now looking to get a house by myself and my friend would like to buy me out. Once we have agreed a price where do we go? Would there be any potential issue with Foundation Home loans with him being responsible for the total loan as opposed to only part of it?
- Law week I split up with my ex of twenty years. I'm now living with my mum and dad and she wants to stay in the property and pay me off. What percentage am I entitled to. Is it 50% of the equity after paying off the mortgage with Foundation Home loans? I assume proper valuations are necessary but I really need to be confident that I'm getting I am not being taken advantage of
- What legal advice do I need when doing a transfer of equity where the mortgage is to remain with Foundation Home loans?
Examples of questions in a conveyancing solicitor questionnaire relating to Foundation Home loans Transfer of Equity
Please state the names and ages of anyone over the age of 17, other than the owners, who will occupy the property with you
Is the transfer of equity subject to a court order? If yes please supply a copy
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?
Has one of the registered owners died? If so please forward us with a copy of all the relevant documents e.g. the will, death certificate etc..
If 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?
Important warnings to consider in further 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 properties
If your property is leasehold, the lease may require that you have a license to do so from the freeholder. If such conditions are not complied with you may be in breach of the lease. This could trigger the freeholder taking enforcement action against you.
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 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 the conclusion 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 conveyancing solicitor 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.