The Mortgage Works transfer of equity: q and a’s
- I am disposing of my share of a property in Hendon to my co-owners fiance, they are sticking with The Mortgage Works as the the existing mortgage company. We are haggling as to who must cover the costs of the transfer of equity. Is this usually split or is one party liable for the costs of?
- As things stand I have a joint The Mortgage Works mortgage with my step-brother and am looking into the option of him taking on the whole mortgage and subtracting myself from it, to enable me to purchase a property with my soon-to-be-wife. The remaining mortgage is in the region 250k, and the property value is in the region 500k. Is this a transfer of equity? Is land tax involved?
- I co-own a flat in Sedgefield
, with a The Mortgage Works loan with my ex partner. Him and his new partner are going to acquire my share. We had the go ahead from The Mortgage Works to replace my name with hers. The transfer of equity needs to be done by a lawyer for The Mortgage Works (apparently). In order to save fees can I do the Land Registry formalities?
- My mum passed away seven months ago leaving a unencumbered bungalow to me and my half brother 50:50. Having continues to reside at the property, there was a provision in her will saying the housecould not be sold for three years following her passing so he could reside there for a prescribed period. He now says he would like to remain in the house beyond the specified period. We have considered a transfer of equity. Am I right in saying we should get a valuation then he'd get a home loan in the conventional way to buy my share?
- When it comes to transfer of equity conveyancing involving a remortgage with The Mortgage Works 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
- Is it possible to apply to request a further advance from The Mortgage Works as part of a Transfer of Equity?
- Is it possible to transfer the equity held in my property with my The Mortgage Works mortgage?
Questions that your conveyancing solicitor could ask in relation to your The Mortgage Works Transfer of Equity
Can you provide the name(s) and addresse(s) of anyone who jointly owns the property with you?
Have you approached The Mortgage Works to obtain consent to the Transfer of Equity
Where you are intent on holding 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 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 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 let us know of you wish us to prepare Declaration of Trust. If so are you willing to incur the further fee (beyond the Transfer of Equity fee)?
Important warnings to consider in conjunction with the above The Mortgage Works transfer of equity Advice :
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
Should the tenure of your property be leasehold, the lease may have a requirement for notices to be served and that you obtain the consent of the freeholder. If such restrictions are not strictly observed you may be in breach 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 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 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 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 The Mortgage Works your property may be repossessed.
Preparing the Transfer of Equity with a The Mortgage Works 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 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 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.