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Are you in need of a Transfer of Equity with a TEST 123 mortgage? Failing to check that a lawyer is on the TEST 123 list of approved solicitors can put your transfer at risk of delay or failure. Only LenderPanel.com provides a subset of authorised conveyancers for over 130 lenders.

Common questions relating to TEST 123 transfer of equity

  • What is the process for having someone removed off the deeds to a property where the mortgage is with TEST 123
  • My wife and myself have equal shares in a investment property. I am a top rate tax payer. Ideally I wish to do a transfer of equity to her sole name in order mitigate tax on rental income. If TEST 123 are content with this the legal fees are not high. What are the implications when we dispose of the property? Would my GGT relief be lost.
  • I currently have a joint TEST 123 mortgage with my cousin and am investigating the possibility of him assuming responsibility for the outstanding mortgage and subtracting myself from it, so as to enable me to buy a place with my partner. The outstanding mortgage is about 250k, and the property value is approx 500k. Is this a transfer of equity? Is land tax payable?
  • I plan to remortgage my apartment in Crabtree moving from Natwest to TEST 123. The flat is jointly owned but propose for it to be in my sole name as and when I transfer. My wife has agreed to this and is willing to sign a form but neither of us want to incur lawyer fees.
  • I bought a flat with my brother five.seven years ago Since then, we have both got married. We are now intending to do a transfer of equity so my name is removed the TEST 123 mortgage. There is a meaningful difference between the 'rightmove estimate' and what the property would sell for currently. Can you offer any advice?
  • Been looking at online blogs that solicitors are more expensive than conveyancers when it comes to transfer of equity conveyancing. Am I better of using a conveyancer or a solicitor if I am transferring equity and simultaneously refinancing with TEST 123
  • What legal advice do I need when doing a transfer of equity where the home loan is to remain with TEST 123?

Questions that your conveyancing solicitor is likely to ask regarding your TEST 123 Transfer of Equity

Please let us know of you wish us to draft you Declaration of Trust. If so are you willing to pay for the further fee (beyond the Transfer of Equity fee)?

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 give the name(s) and addresse(s) of anyone who jointly owns the premises with you?

Have you approached TEST 123 to seek consent to the Transfer of Equity

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

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

General Advice to read in in addition to the above TEST 123 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 TEST 123 conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold titles

If your property is leasehold, provisions in the lease may require that you obtain the consent of the landlord. If such conditions are not complied with you may be in violation of the lease. This could potentially result in the freeholder taking enforcement action against you.

Indemnity Insurance

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 lawyer will check with TEST 123 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 TEST 123 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 conveyancing.
If you do not keep up the payments on your mortgage with TEST 123 your property may be repossessed.

Preparing the Transfer of Equity with a TEST 123 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 TEST 123 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 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.


Frequently asked questions relating to TEST 123 transfer of equity