Top seven questions relating to Scottish Building Society transfer of equity
- I am trying to find a conveyancer to undertake my transfer of equity. Scottish Building Society have been approached for a refinancing. I considered asking my mortgage broker. I am lead to believe he will likely get a referral fee for suggesting someone, but also of benefit will be that he knows the lawyer, has dealt with them before. Any flaws you see in this way of thinking?
- Scottish Building Society yesterday agreed I can take over the home loan on the flat. I had applied for a transfer of equity but presumably there is a transfer of ownership of the title deeds as well?
- Is it possible to transfer the equity held in my property with my Scottish Building Society mortgage?
- My mother passed away half a year ago leaving a mortgage-free property to me and my step brother 50:50. He has always lived in the property, there was a condition in the will specifying that the housecould not be sold for three years following her death so he could continue to live there for a specified time frame. He now says he would like to remain in the property beyond the specified period. We have discussed a transfer of equity. Would I be right in thinking that we'd get a valuation then he'd get a mortgage in the conventional way to purchase my equity?
- What are the average legal costs are for a transfer of equity? I need to transfer equity and remortgage - new loan with Scottish Building Society - and have been quoted £350 including VAT by Scottish Building Society's appointed lawyer, Have I been over quoted?
- My partner and I equally own a BTL. I am a higher rate tax payer. Preferably I would like to complete a transfer of equity into her name to reduce our tax on rental income. Assuming Scottish Building Society are happy with this the legal fees are not prohibitive. What are the implications when we sell? As I would no longer be on the title documents would I lose my CGT relief.
- When it comes to transfer of equity conveyancing involving a remortgage with Scottish Building Society should I be charged VAT on the following: (1) Land Registry fee on the transfer of equity (2) Pre - completion search fee (3) SDLT E submission on the transfer (4) Bank TT fee
Questions that your conveyancing solicitor is likely to ask in relation to your Scottish Building Society Transfer of Equity
Would you like us to draft you Declaration of Trust. If so are you willing to pay for the further fee (beyond the Transfer of Equity fee)?
If 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 provide the name(s) and addresse(s) of anyone to be extracted from the property title?
Who will be responsible for the costs of the Transfer of Equity?
Please confirm whether this Transfer of Equity is part of any Matrimonial Proceedings? If so, please provide the name, address, telephone number and reference of the Matrimonial Solicitor instructed to act, along with a copy of the sealed Consent or Court Order?
Please provide a copy of your National Insurance Number?
Caveats to be read in supplemental the above Scottish 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 Scottish 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 require that you obtain the consent of the freeholder. If such conditions are not strictly observed you may be in breach of your covenants under the lease. This could potentially result in 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 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 Scottish 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 Scottish 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 the conclusion of the transfer of equity transaction.
Your property may be repossessed if you do not keep up repayments on your mortgage with Scottish Building Society.
Preparing the Transfer of Equity with a Scottish 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 Scottish 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.
Information provided 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.