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Questions and answers: ITL Mortgages transfer of equity

  • What if my application doesn't meet ITL Mortgages lending criteria for a transfer of equity?
  • What legal advice do I need when doing a transfer of equity where the home loan is to remain with ITL Mortgages?
  • How much the typical conveyancing charges are for a transfer of equity? I need to transfer equity and remortgage - new loan with ITL Mortgages - and have been quoted £250 excluding VAT by ITL Mortgages's approved lawyer, Have I been over quoted?
  • I am looking for a conveyancing solicitor to undertake my transfer of equity. ITL Mortgages have been approached for a remortgage. I thought of asking my financial adviser. I am lead to believe he will likely get a kickback for suggesting a firm, but also of benefit will be that he knows the conveyancer, has a working relationship with them. Is my logic misguided?
  • ITL Mortgages yesterday agreed I can take over the home loan on the house. I previously applied for a transfer of equity but presumably there is a transfer of ownership of the house on top?
  • Can I apply to borrow more money from ITL Mortgages as part of a Transfer of Equity?
  • At what point do I incur the Stamp Duty Land Tax payable for the transfer of equity in my house in my name alone which is taking place simultaneously with a switching mortgage via ITL Mortgages?

Questions that your lawyer is likely to ask in relation to your ITL Mortgages Transfer of Equity

Please let us know where you are providing any payment for the Transfer of Equity and to whom and disclose any such sums?

Please list all persons who occupy the property, their respective ages and relationships to you.

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

Would you like us to draw up a Declaration of Trust. If so are you happy to pay for the further fee (beyond the Transfer of Equity fee)?

Please confirm the person to be removed from the title deeds will not reside at the property after completion of the Transfer of Equity?

Where you 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?

General Advice to read in conjunction with the above ITL Mortgages 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 ITL Mortgages conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold properties

Should the tenure of your property be leasehold, the lease may require 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.

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 cases, 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 ITL Mortgages 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 ITL Mortgages 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.
Your property may be repossessed if you do not keep up repayments on your mortgage with ITL Mortgages.

Preparing the Transfer of Equity with a ITL Mortgages 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 ITL Mortgages 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 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.


Frequently asked questions relating to ITL Mortgages transfer of equity