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Questions and answers: The Mortgage Business transfer of equity

  • I got my Decree Absolute in 2011. For some reason I never dealt with the transfer ownership from the current 'joint' status to my name alone. I now plan to deal with it and there are no objections. Transfer-of-equity is presumably the way forward. The Mortgage Business is content to transfer the property and loan in my name (financial checks done). Does she need a conveyancer?
  • I plan to remortgage my flat in Sedgefield moving from Lloyds TSB to The Mortgage Business. The maisonette is jointly owned but propose for it to be in my sole name as and when I transfer. My wife has verbally consented to this and is willing to sign a form but neither of us want to get a second conveyancer involved.
  • What legal advice do I need when doing a transfer of equity where the mortgage is to remain with The Mortgage Business?
  • At what point do I pay stamp duty chargeable for the transfer of equity in my property in my name alone which is happening simultaneously with a switching mortgage via The Mortgage Business?
  • Is it sensible to cancel my mortgage payments with The Mortgage Business as soon as a date for my remortgage and transfer of equity has been set?
  • Can I apply to borrow a further advance from The Mortgage Business as part of a Transfer of Equity?
  • After 2 a couple of years estranged I have decided to give up my share of our former home to my husband who is re-mortgaging with The Mortgage Business. Can a transfer of equity be done in less than one month?

Examples of questions in a conveyancing solicitor form relating to The Mortgage Business Transfer of Equity

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

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 what sums

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

We need you to supply the National Insurance Number(s) of all the new owners (required for submission of the Stamp Duty Land Tax Form)

Would you like us to draft you Declaration of Trust. If so are you happy to incur the additional fee (beyond the Transfer of Equity fee)?

Caveats to be read in supporting the above The Mortgage Business 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 The Mortgage Business conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold premises

Should the tenure of your property be leasehold, the lease may require that you obtain the consent of the freeholder. If such conditions are not complied with you may be in breach 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 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 The Mortgage Business 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 The Mortgage Business 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 finalisation of the transfer of equity transaction.
If you do not keep up the payments on your mortgage with The Mortgage Business your property may be repossessed.

Preparing the Transfer of Equity with a The Mortgage Business 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 The Mortgage Business 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.


Frequently asked questions relating to The Mortgage Business transfer of equity