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Principality Building Society

Sample questions relating to Principality Building Society transfer of equity

  • I am thinking of remortgaging my apartment in Littleborough does my lawyer need to be on the Principality Building Society Solicitor panel. The conveyancing also involves a transfer of equity.
  • My partner and I jointly own a buy to let. I am a top rate tax payer. Ideally I would like to do a transfer of equity into her name to mitigate tax on rental income. If Principality Building Society are content with this the legal fees are inexpensive. What are the implications when we sell? As I would no longer be on the title documents would I lose my CGT relief.
  • I am completing a Principality Building Society transfer of equity application and have come to the section that asks about defaults etc. I do some debts that I have been discharging over a long period, I understand that they have long since disappeared from my credit records. Do I need to reveal these?
  • When it comes to transfer of equity conveyancing involving a remortgage with Principality Building Society should I be charged value added tax on the following: (1) HMLR fee on the transfer of equity (2) Pre - completion search fee (3) SDLT E submission on the transfer (4) Bank TT fee
  • My decree absolute is through as is the consent order. Now I must address the transfer of equity for the property and the Principality Building Society mortgage. I have contacted Principality Building Society for the transfer of equity forms. What happens next?
  • I am disposing of my equity in apartment in Birmingham to my co-owners husband, they are reapplying to Principality Building Society. We are haggling as to who should pay the charges for the transfer of equity. Is this usually shared or is one of us liable for the costs of?
  • As things stand I have a joint Principality Building Society mortgage with my brother and am looking into the feasibility of him taking on the outstanding mortgage and subtracting myself from it, so as to enable me to purchase somewhere with my partner. The outstanding mortgage is in the region 250k, and the property value is approx 600k. Is this a transfer of equity? Is land tax payable?

Information that may be required from your lawyer may ask regarding your Principality Building Society Transfer of Equity

Please let us know of you wish us to draw up a Declaration of Trust. If so are you willing to incur the further fee (beyond the Transfer of Equity fee)?

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

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

Who will be responsible for the costs of the Transfer of Equity?

Will there be any payment between the parties for the Transfer of Equity? Where this is the case, please state the amount and who is to receive the same

General Advice to read in supplemental the above Principality Building Society transfer of equity Questions and Answers :

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 Principality Building Society 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 have a requirement for notices to be served and that you have a license to do so from the freeholder. If such terms are not adhered to you may be in violation of your covenants under the lease. This could trigger 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 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 conveyancer will check with Principality 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 Principality 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 is dependent on the valuation 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 Principality Building Society your property may be repossessed.

Preparing the Transfer of Equity with a Principality 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 Principality 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 lawyer 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.


Frequently asked questions relating to Principality Building Society transfer of equity