Common questions relating to Metro Bank transfer of equity
- Me and a friend got a joint mortgage with Metro Bank on a apartment about a year ago. I am now thinking of purchasing a property by myself and my friend would like to buy me out. On the basis that we can settle on a price what happens next? Is there likely to be any issue with Metro Bank with him being responsible for the total mortgage rather than only part of it?
- I am trying to find a lawyer to deal with my transfer of equity. Metro Bank have been approached for a refinancing. I thought of asking my financial adviser. I am lead to believe he will likely receive a referral fee for suggesting a firm, but also of benefit will be that he knows the conveyancer, has dealt with them before. Is my logic correct?
- Me and my partner co-own a property in Heathfield
. Home loan is with Metro Bank. I wish to transfer full ownership to him with no exchange of money but without using a conveyancing solicitor. Do you think this should be simple?
- My father passed away last January leaving a unencumbered semi to me and my step brother in equal shared. Having continues to reside at the property, there was a clause in the will saying the propertycould not be sold for 2 years after her passing so he could reside there for a while. 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 home loan in the usual way to buy my half from me?
- Am I best advised cancel my mortgage payments with Metro Bank once a date for my remortgage and transfer of equity has been agreed?
- Do I need legal representation when doing a transfer of equity where the home loan is to remain with Metro Bank?
- How much the typical conveyancing costs are for a transfer of equity? I need to transfer equity and refinance - new loan with Metro Bank - and have been quoted £350 including VAT by Metro Bank's approved conveyancer, Have I been over quoted?
Information that may be required from your conveyancer is likely to ask about your Metro Bank Transfer of Equity
Please provide the details of anyone to be added to the property title?
Would you like us to draft you Declaration of Trust. If so are you happy to pay for the additional fee (beyond the Transfer of Equity fee)?
Has one of the registered owners died? If so please supply us with a copy of the Death Certificate, Probate and a copy of the Will.
Please confirm whether you are receiving any payment as part of the Transfer or Equity and from whom and give details of the amount?
Please provide the details of anyone to be extracted from the property title?
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?
Important warnings to consider in supporting the above Metro Bank transfer of equity Advice :
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 Metro Bank conveyancing panel and accountant before transferring equity.
Transfer of Equity Conveyancing for Leasehold premises
If your property is leasehold, the lease may require that you obtain the consent of the freeholder. If such conditions are not strictly observed 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 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 Metro Bank 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 Metro Bank 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 conclusion of the transfer of equity transaction.
If you do not keep up the payments on your mortgage with Metro Bank your property may be repossessed.
Preparing the Transfer of Equity with a Metro Bank 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 Metro Bank 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 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.