Top seven questions relating to HSBC transfer of equity
- I currently have a joint HSBC mortgage with my step-brother and am investigating the feasibility of him taking on the outstanding mortgage and removing myself from it, so as to enable me to buy a place with my fiance. The remaining mortgage is in the region 300k, and the property value is about 450k. Is this a transfer of equity? Is land tax involved?
- I am answering a HSBC transfer of equity application and have arrived at the questions that asks about debts etc. I do some debts that I have been reducing since 2007, in fact they have long since disappeared from my credit records. Am I obliged to disclose these?
- I bought a flat with a friend five.seven years ago Since buying the property, we have both got married. We are now seeking to do a transfer of equity so my name comes off the HSBC mortgage. There is a meaningful difference between the value the bank say and what the property would sell for currently. Can you offer any advice?
- When it comes to transfer of equity conveyancing involving a remortgage with HSBC should I be invoiced VAT on the following: (1) Land Registry fee on the transfer of equity (2) Pre - completion search fee (3) SDLT E submission on the transfer (4) Bank TT fee
- Me and a friend got a joint mortgage with HSBC on a flat a couple of years ago. I am now looking to get a house on my own and my friend would like to buy me out. Once we have agreed an amount what happens next? Is there likely to be any issue with HSBC with him being solely liable for the total mortgage rather than only half of it?
- I co-own a house in Romsey
, with a HSBC mortgage with my former partner. He and his new partner are going to acquire my share. We had consent from HSBC to substitute my name with hers. The transfer of equity needs to be done by a lawyer for HSBC (supposedly). Can we do the Land Registry change?
- Can I apply to request more money from HSBC as part of a Transfer of Equity?
Questions that your conveyancer is likely to ask in relation to your HSBC Transfer of Equity
Please confirm where you are providing any payment for the Transfer of Equity and to whom and give details of the amount?
Would you like us to prepare Declaration of Trust. If so are you willing to incur the further fee (beyond the Transfer of Equity fee)?
Please provide the details of anyone to be added to the property title?
Please provide the details of those who jointly own the premises with you?
If 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” Questionnaire.
Please give the details of anyone to be removed from the title deeds?
Information to consider in in addition to the above HSBC transfer of equity Info :
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 HSBC conveyancing panel and accountant before transferring equity.
Transfer of Equity Conveyancing for Leasehold titles
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 potentially result in 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 conveyancer will check with HSBC 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 HSBC 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 transaction.
If you do not keep up the payments on your mortgage with HSBC your property may be repossessed.
Preparing the Transfer of Equity with a HSBC 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 HSBC 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 lawyer 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.