Recently asked questions relating to Paragon Mortgages transfer of equity
- Is it possible to transfer the equity held in my property with my Paragon Mortgages mortgage?
- What should I be budgeting for when it comes to what legal costs are for a transfer of equity? I'm in the process of remortgaging - moving over to Paragon Mortgages - and have been quoted £350 including VAT by Paragon Mortgages's appointed conveyancer, Is this a reasonable price?
- My father died early last year leaving a unencumbered property to me and my half brother 50:50. He has always lived in the property, there was a clause in her will saying the housecould not be sold for 2 years after her passing so he could reside there for a specified time frame. He now wishes to remain in the house beyond the prescribed period. We have considered a transfer of equity. Would I be right in thinking that we'd get a valuation then he'd get a mortgage in the usual way to purchase my share?
- My brother and I got a joint mortgage with Paragon Mortgages on a apartment about a year ago. I am now thinking of buying a house by myself and my friend would like to buy me out. Assuming we can agree a price what are the next steps? Is there likely to be any problem with Paragon Mortgages with him being solely liable for the total loan rather than only part of it?
- Can I apply to borrow more money from Paragon Mortgages as part of a Transfer of Equity?
- I am led to believe we would need at least AP1 and TR1. Is this true?
- I am transferring my share of a house in Hendon to my co-owners fiance, they are sticking with Paragon Mortgages as the the existing lender. We are debating as to who must pay the legal bill for the transfer of equity. Should this be split or is one of us liable for the costs of?
Questions that your conveyancing solicitor may ask about your Paragon Mortgages Transfer of Equity
Has consent been obtained from Paragon Mortgages to the proposed transfer of equity?
Please give the name(s) and addresse(s) of those who jointly own the property with you?
Please confirm if you are making any payment for the Transfer of Equity and to whom and specify any such sums?
Please provide the name(s) and addresse(s) of anyone to be removed from the title deeds?
Would you like us to draft you Declaration of Trust. If so are you happy to pay for the further fee (beyond the Transfer of Equity fee)?
Is it the case that 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.
Caveats to be read in further to the above Paragon Mortgages transfer of equity information :
Tax and Legal
There may be various tax and legal implications when transferring equity for your property. You should always seek the advice of a solicitor on the Paragon Mortgages conveyancing panel and accountant before transferring equity.
Transfer of Equity Conveyancing for Leasehold titles
If your property is leasehold, provisions in the lease may have a requirement for notices to be served and that you obtain the consent of the landlord. If such terms are not adhered to 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 conveyancer will check with Paragon 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 Paragon 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 valuation of the property at the conclusion of the transfer of equity conveyancing.
If you do not keep up the payments on your mortgage with Paragon Mortgages your property may be repossessed.
Preparing the Transfer of Equity with a Paragon Mortgages 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 Paragon 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 conveyancer 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.