A Transfer of Equity is the process when someone is either added or removed from the title deed(s), such as either a sole owner adding their husband or wife or a parent adding their son or daughter or a couple separates. It is a reasonably straightforward transaction provided that all parties, including any Lender or Building Society, agree. There are circumstances that Stamp Duty Land Tax will be payable to HM Revenue and Customs which we will be able to offer the professional advice to ensure that everything is as smooth and stress free as possible
Transfer of Equity with a Mortgage or money changing hands
If you wish to add or remove a person from the title deeds and if there is also a mortgage involved then you will need to obtain permission from your mortgage lender. The process has to be complied with, as the names on the mortgage deed have to match the names on the transfer deed. As the process is more complicated which will be reflected in your legal fees.
Also if money is changing hands e.g. if someone is being removed and the remaining owner is buying out their share, then this will make the transfer of equity more complicated and you may incur additional legal fees.
Although we can provide you a fixed fee for your legal costs there may be extra costs that you may incur by way of some disbursements, which are payments to third parties on your behalf. Until we investigate your specific circumstances we will be unable to fully give you a quote you for the following:-
You may not be aware that you may have to pay stamp duty when adding or removing someone from the title deeds as this is due to anything of monetary value that is given in exchange for the property are referred to as the ‘consideration’. This could include a cash transfer or a mortgage. Until we investigate your specific circumstances it is impossible for us to determine if stamp duty is payable and if so how much.
Search Indemnity Insurance
If there is a mortgage involved, chances are that the mortgage lender will ask you to pay for search indemnity insurance. The insurance (which is a one off payment) will protect your lender from financial losses if anything that would have been revealed in the searches affects the value of the property. The cost of the insurance will dependent up on a number of factors, such as the value of the mortgage and the value of the property.
Transfer of Equity with No Mortgage
If there is no mortgage on the property and no money will be changing hands then a transfer of equity is a fairly simple process. We should be able to complete the transfer quite quickly depending on how fast you provide certified identification and return documents. The Land Registry may take a week’s time to fully register the new owners of the property.
Land Registry Fee
The Land Registry will charge a fee for changing the owners of the property and how much they will charge depends on a number of factors such as how much the property is worth, the value of the mortgage etc. This will cost a minimum of £40.00.
Transfer of Equity for a Leasehold Property
If the property is leasehold then it is likely that the freeholder will charge their own administration fees. We will make you aware of these as soon as we are informed by the freeholder which you will also be able to find out yourself by contacting the management company/landlord directly.
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For a free, no obligation conveyancing quote and general help and advice with your house sale or purchase, please ring us today on 0208 574 0666.