Top seven questions relating to Newbury Building Society transfer of equity
- My fiance and I have equal shares in a BTL. I am a higher rate tax payer. Preferably I would like to complete a transfer of equity to her sole name in order mitigate tax on rental income. If Newbury Building Society are happy with this the legal fees are inexpensive. However what happens when we dispose of the property? Would my GGT relief be lost.
- Do I need legal representation when doing a transfer of equity where the home loan is to remain with Newbury Building Society?
- I bought a property with a friend five.seven years ago Since then, we have both got married. We are now seeking to do a transfer of equity so my name is taken off the Newbury Building Society mortgage. There is a significant difference between the value the lender hold and what the property would sell for currently. Can you offer any advice?
- I am trying to find a conveyancing solicitor to deal with my transfer of equity. Newbury Building Society are dealing with the remortgage. I thought of asking my financial adviser. I understand he will likely receive a kickback for recommending a firm, but also of benefit will be that he knows the lawyer, has dealt with them before. Is my logic correct?
- My divorce has gone through as is the consent order. Now I need to deal with the transfer of equity for the property and the Newbury Building Society home loan. I have contacted Newbury Building Society for the transfer of equity forms. What happens next?
- My friend and I got a joint mortgage with Newbury Building Society on a flat 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 an amount where do we go? Would there be any potential concerns with Newbury Building Society with him being on the hook for the total mortgage rather than only half of it?
- I am answering a Newbury Building Society transfer of equity application and have come to the questions that asks about defaults etc. There are some debts that I have been discharging over a long period, in fact they no longer remain my credit records. Do I need to set these out?
Sample of information requested in a conveyancing solicitor questionnaire relating to Newbury Building Society Transfer of Equity
Who will be responsible for the costs of the Transfer of Equity?
If you are adding someone on to the title deeds how do you wish to hold the property? Please provide your instructions by completing and returning a“Joint Ownership Declaration” Form.
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?
Please let us know of you wish us to draft you Declaration of Trust. If so are you happy to pay for the additional fee (beyond the Transfer of Equity fee)?
Have you approached Newbury Building Society to seek consent to the Transfer of Equity
Has one of the registered proprietors passed away? If so please supply us with a copy of the Death Certificate, Probate and a copy of the Will.
Information to consider in conjunction with the above Newbury Building Society 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 Newbury Building Society conveyancing panel and accountant before transferring equity.
Transfer of Equity Conveyancing for Leasehold premises
Should the tenure of your property be leasehold, the lease may require that you have a license to do so from the landlord. If such conditions are not complied with you may be in breach of the lease. This could trigger 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 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 Newbury Building Society 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 Newbury Building Society 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 Newbury Building Society.
Preparing the Transfer of Equity with a Newbury Building Society 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 Newbury Building Society 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 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.