Frequently asked questions relating to The Mortgage Works transfer of equity

• My current home loan is with The Mortgage Works. Can I transfer equity to someone who is not yet eighteen years old?
• My friend and I got a joint mortgage with The Mortgage Works on a house about a year ago. I am now thinking of purchasing a flat by myself and my friend would like to buy me out. Assuming we can agree a price what are the next steps? Would there be any potential concerns with The Mortgage Works with him being responsible for the total mortgage as opposed to only half of it?
• My partner and I jointly own a flat in Winchelsea . Home loan is with The Mortgage Works. I would like to transfer full ownership to him with no payment of money but without using a lawyer. Do you think this should be easy to so?
• Online research suggests that solicitors are more expensive than conveyancers for transfer of equity conveyancing. So is it better if I use a conveyancer or a solicitor if I am transferring equity and simultaneously refinancing with The Mortgage Works
• I am trying to find a conveyancing solicitor to deal with my transfer of equity. The Mortgage Works are dealing with the refinancing. I considered asking my mortgage broker. I understand he will likely receive a referral fee for recommending a firm, but also of benefit will be that he knows the conveyancing solicitor, has a working relationship with them. Is my logic correct?
• My mum died last January leaving a unencumbered semi to me and my half brother 50:50. Having continues to reside at the house, there was a clause in her will specifying that the propertycould not be sold for 24 months following her passing so he could continue to live there for a prescribed period. He now wants to remain in the premises beyond the specified period. We have considered a transfer of equity. Would I be right in thinking that we'd get a valuation then he'd get a home loan in the traditional way to buy my equity?
• Do I need legal representation when doing a transfer of equity where the home loan is to remain with The Mortgage Works?

Information that may be required from your lawyer is likely to ask regarding your The Mortgage Works Transfer of Equity

Important warnings to consider in supporting the above The Mortgage Works 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 The Mortgage Works conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold titles

If your property is leasehold, the lease may require that you have a license to do so from the landlord. If such terms are not adhered to you may be in breach of the lease. This could potentially result in 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 lawyer will check with The Mortgage Works 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 Works 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 valuation of the property at the conclusion of the transfer of equity transaction.

Preparing the Transfer of Equity with a The Mortgage Works Mortgage

When it comes to preparing the the Land Registry documents your conveyancer should in the ‘consideration’ panel choose the first option, if consideration is given; otherwise ignore the consideration panel altogether.

If The Mortgage Works 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.

Content 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.