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Frequently asked questions relating to Virgin transfer of equity

  • I am am in need of a lawyer to handle my transfer of equity. Virgin are dealing with the refinancing. I thought of asking my financial adviser. I am lead to believe he may get a kickback for recommending someone, but also of benefit will be that he knows the conveyancing solicitor, has dealt with them before. Any flaws you see in this way of thinking?
  • At what point do I cover the costs of the Stamp Duty Land Tax due for the transfer of equity in my home in my name alone which is taking place at the same time as a remortgage via Virgin?
  • I co-own a flat in Littleborough , with a Virgin loan with my former partner. He and his new partner are going to acquire my share. We had approval from Virgin to replace my name with hers. The transfer of equity has to be completed by a conveyancer for Virgin (apparently). Is it possible for us to deal with the Land Registry formalities?
  • Will I have to pay any charges for a Transfer of Equity where the existing mortgage is with Virgin?
  • Is it sensible to cancel the direct debit for my mortgage with Virgin as soon as a date for my remortgage and transfer of equity has been agreed?
  • My fiance and I equally own a buy to let. I am a top rate tax payer. Preferably I would like to do a transfer of equity into her name in order mitigate tax on the letting income. If Virgin are fine with this the legal fees are not high. However what happens when we dispose of the property? Would my GGT relief be lost.
  • Can I apply to borrow more money from Virgin as part of a Transfer of Equity?

Information that may be required from your lawyer may ask about your Virgin Transfer of Equity

Can you provide the details of anyone who jointly owns the premises with you?

Please give the details of anyone to be added to the property title?

Is it the case that one of the registered owners died? If so please forward us with a copy of the Death Certificate, Probate and a copy of the Will.

Please confirm whether you are receiving any payment as part of the Transfer or Equity and from whom and give details of the amount?

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” Form.

Please confirm the person to be removed from the title deeds will not reside at the property after the transfer of equity has been completed?

Caveats to be read in further to the above Virgin transfer of equity Info :

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 Virgin conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold premises

If your property is leasehold, provisions in the lease may require that you have a license to do so from the freeholder. If such conditions are not complied with you may be in breach of your covenants under 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 conveyancing solicitor 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 time of completion 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 lawyer 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 Virgin transfer of equity