New Life Mortgages transfer of equity: q and a’s
- Me and a friend got a joint mortgage with New Life Mortgages on a property a couple of years ago. I am now thinking of buying a house by myself and my friend would like to buy me out. Once we have agreed a price what happens next? Is there likely to be any concerns with New Life Mortgages with him being on the hook for the total loan rather than only half of it?
- Am I best advised cancel the direct debit for my mortgage with New Life Mortgages as soon as a date for my remortgage and transfer of equity has been set?
- I am disposing of my share of a apartment in Hendon to the other co-owners fiance, they are reapplying to New Life Mortgages. We are debating as to who should cover the legal bill for the transfer of equity. Should this be shared or is one of us obliged to cover the costs of?
- My mum passed away seven months ago leaving a unencumbered house to me and my brother in equal shared. Having continues to reside at the house, there was a provision in the will specifying that the propertycould not be sold for 2 years after her death so he could reside there for a prescribed period. He now wants 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 traditional way to purchase my share?
- Three years ago I purchased a flat without my partner's name on the title documents. My conveyancer claimed it is because she was not in the mortgage with New Life Mortgages. Is it possible for me to put her name on the documents at HMLR?
- My New Life Mortgages home loan is in joint names with ex, who is agreeable to be removed and let me have the property. New Life Mortgages will permit the transfer of equity to my individual name. Will New Life Mortgages contact my employer to check my salary?
- My ex are seeking to get a conveyancing solicitor in place for a refinance with New Life Mortgages. Transfer of Equity conveyancing is also neededI have used the different rating based websites and the results are from all over UK. Do we need to instruct a conveyancer local to us?
Information that may be required from your lawyer may ask regarding your New Life Mortgages Transfer of Equity
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 name(s) and addresse(s) of anyone who jointly owns the property with you?
Have you approached New Life Mortgages to seek consent to the Transfer of Equity
Please list all persons who occupy the property, their respective ages and relationships to you.
Please let us know of you wish us to prepare Declaration of Trust. If so are you happy to pay for the further fee (beyond the Transfer of Equity fee)?
We need you to provide the National Insurance Number(s) of all the new owners (required for submission of the Stamp Duty Land Tax Form)
Caveats to be read in in addition to the above New Life Mortgages 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 New Life Mortgages conveyancing panel and accountant before transferring equity.
Transfer of Equity Conveyancing for Leasehold titles
Should the tenure of your property be leasehold, the lease may have a requirement for notices to be served and that you obtain the consent of the freeholder. If such terms are not adhered to you may be in breach of your covenants under the lease. This could trigger the freeholder taking enforcement action against you.
If the transfer of equity is made pursuant to 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 New Life 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 New Life 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 is dependent on the market value of the property at the time of completion of the transfer of equity conveyancing.
If you do not keep up the payments on your mortgage with New Life Mortgages your property may be repossessed.
Preparing the Transfer of Equity with a New Life 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 New Life 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 conveyancing solicitor should describe the transfer as ‘transfer of equity’ to assist Land Registry staff.
Content 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.