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Magellan Homeloans

Top seven questions relating to Magellan Homeloans transfer of equity

  • My current mortgage is with Magellan Homeloans. Can I transfer equity to someone less than 18 years old?
  • I currently have a joint Magellan Homeloans mortgage with my cousin and am investigating the option of him assuming responsibility for the whole mortgage and subtracting myself from it, to enable me to purchase somewhere with my fiance. The outstanding mortgage is about 175k, and the property value is in the region 600k. Is this a transfer of equity? Is stamp duty due?
  • Three years ago I purchased a apartment without my wife's name on the title. My lawyer advised it is because she was not in the loan offer with Magellan Homeloans. I'm wondering is there any way that I can add her name on the title?
  • Can I apply to borrow more money from Magellan Homeloans as part of a Transfer of Equity?
  • I jointly own a property in Rye , with a Magellan Homeloans mortgage with my ex husband. He and his new partner are going to acquire my share. We had consent from Magellan Homeloans to substitute my name with hers. The transfer of equity needs to be done by a lawyer for Magellan Homeloans (apparently). Is it possible for us to do the Land Registry formalities?
  • I am completing a Magellan Homeloans transfer of equity form and have arrived at the questions regarding debts etc. There are some debts that I have been clearing since 2008, I understand that they no longer remain my credit records. Do I need to declare these?
  • What if my application doesn't meet Magellan Homeloans lending criteria for a transfer of equity?

Examples of information requested in a conveyancer form relating to Magellan Homeloans Transfer of Equity

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

Can you give the name(s) and addresse(s) of those who jointly own the premises with you?

Where you are adding a person on to the title deeds how would you like to hold the property? Please provide your instructions by completing and returning a“Joint Ownership Declaration” Questionnaire.

Where you are going to hold the property as beneficial Tenants in Common in unequal shares, what is the split to be. For e.g. 50-50, or 60-40?

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

Important warnings to consider in supplemental the above Magellan Homeloans 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 Magellan Homeloans conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold premises

Should the tenure of your property be leasehold, provisions in the lease may require that you obtain the consent of the landlord. If such conditions are not complied with you may be in violation of your covenants under 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 conveyancer will check with Magellan Homeloans 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 Magellan Homeloans 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 is dependent on the market value of the property at the time of completion of the transfer of equity transaction.
If you do not keep up the payments on your mortgage with Magellan Homeloans your property may be repossessed.

Preparing the Transfer of Equity with a Magellan Homeloans 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 Magellan Homeloans 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 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 Magellan Homeloans transfer of equity