Frequently asked questions relating to Principality Building Society transfer of equity
- My partner and I jointly own a BTL. I am a higher rate tax payer. Ideally I wish to do a transfer of equity into her name in order reduce our tax on the letting income. If Principality Building Society are happy with this the legal fees are not high. However what happens when we sell? As I would no longer be on the deeds would I lose my CGT relief.
- Principality Building Society have just agreed I can take over the home loan on the flat. I previously applied for a transfer of equity but is this a transfer of ownership of the house on top?
- Two years ago I purchased a flat without my wife's name on the title documents. My lawyer claimed it is because she is not in the mortgage with Principality Building Society. Is it possible for me to put her name on the deeds?
- I am transferring my share of a apartment in Woodside to my co-owners husband, they are reapplying to Principality Building Society. We are debating as to who must cover the legal bill for the transfer of equity. Is this normally split or is one of us obliged to cover the fees for?
- I currently have a joint Principality Building Society mortgage with my brother and am investigating the possibility of him taking on the outstanding mortgage and removing myself from it, to enable me to purchase a property with my partner. The outstanding mortgage is about 200k, and the property value is approx 600k. Is this a transfer of equity? Is land tax due?
- My ex are looking to get a lawyer lined up for a remortgage with Principality Building Society. Transfer of Equity conveyancing is also necessaryI have used the different comparison based websites and the results are from all over UK. Is it important to instruct a conveyancer local to us?
- What can I do where I am not happy with the conveyancing solicitor who undertook my transfer of equity transaction?
Information that may be required from your conveyancing solicitor may ask regarding your Principality Building Society Transfer of Equity
Have you approached Principality Building Society to seek consent to the Transfer of Equity
Please provide the details of anyone to be added to the title deeds?
Can you provide the name(s) and addresse(s) of anyone who jointly owns the premises with you?
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?
Where you are adding a person on to the title deeds how would you like to hold the property? Please provide your instructions by completing and returning a“Joint Ownership Declaration” Questionnaire.
Please provide a copy of your National Insurance Number?
General Advice to read in supplemental the above Principality Building Society transfer of equity Advice :
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 Principality Building Society conveyancing panel and accountant before transferring equity.
Transfer of Equity Conveyancing for Leasehold titles
If your property is leasehold, the lease may have a requirement for notices to be served and that you have a license to do so from the landlord. If such conditions are not complied with you may be in violation of 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 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 conclusion of the transfer of equity transaction.
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 lawyer 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 conveyancer 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.