Recently asked questions relating to Virgin transfer of equity
- What legal advice do I need when doing a transfer of equity where the home loan is to remain with Virgin?
- What if my application doesn't meet Virgin lending criteria for a transfer of equity?
- Is stamp duty payable when it comes to an transfer of equity with a mortgage with Virgin?
- When it comes to transfer of equity conveyancing involving a remortgage with Virgin should I be charged value added tax on the following: (1) HMLR fee on the transfer of equity (2) Pre - completion search fee (3) SDLT E submission on the transfer (4) Bank TT fee
- My dad passed away seven months ago leaving a unencumbered house to me and my step brother 50:50. Having continues to reside at the premises, there was a clause in her will saying the propertycould not be sold for 24 months following her passing so he could remain there for a specified time frame. He now says he would like to remain in the premises 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 traditional way to acquire my half from me?
- My brother and I got a joint mortgage with Virgin on a apartment about a year ago. I am now looking to get a property by myself and my friend would like to buy me out. Assuming we can agree an amount what are the next steps? Is there likely to be any problem with Virgin with him being responsible for the total mortgage rather than only half of it?
- I am disposing of my equity in house in Warwick to my co-owners husband, they are reapplying to Virgin. We are haggling as to who should cover the charges for the transfer of equity. Is this normally split or is one of us obliged to cover the fees for?
Examples of information requested in a conveyancing solicitor form relating to Virgin Transfer of Equity
Please confirm the person to be removed from the title deeds will not reside at the property after the transfer of equity has been formalised?
Can you give the name(s) and addresse(s) of those who jointly own the premises with you?
Please give the name(s) and addresse(s) of anyone to be added to the property title?
Have you approached Virgin to seek consent to the Transfer of Equity
Please confirm whether you are receiving any payment as part of the Transfer or Equity and from whom and give details of the amount?
Please provide the details of anyone to be extracted from the property title?
Caveats to be read in conjunction with the above Virgin 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 Virgin 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 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 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 lawyer will check with Virgin 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 Virgin 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.
Your property may be repossessed if you do not keep up repayments on your mortgage with Virgin.
Preparing the Transfer of Equity with a Virgin 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 Virgin 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.