Transfer of Equity

What is a Transfer of Equity?

A Transfer of Equity is the transfer in ownership, or co-ownership of a property. There are a number of reasons for transferring equity. These include;

• Removing an ex-partner from the deeds after a divorce
• Adding a spouse to the deeds of your home after getting married or re-married
• The gifting of a property
• Reducing future inheritance tax liabilities in the event of a person’s death
• To take advantage of personal capital gains limits

What is equity?

Equity is the value of your property minus the outstanding mortgage amount. So if you bought your home for £250,000 and your remaining mortgage is £100,000, you have £150,000 of equity.

What’s the process for transferring equity?

Before you start a transfer of equity, you need an original copy of the title to the property. We use this to check if there are any existing mortgages on the property. It’s also used to check if there are any restrictions on the property.

We’ll then review the title deeds, check and confirm your ID and then prepare the transfer deeds.

The next step depends on whether you have a mortgage on your property or not.

If there is no mortgage

You and the new owner(s) will sign the transfer deed in the presence of a witness. We’ll then register the transfer deed with the Land Registry. We’ll also need a Stamp Duty Land Tax certificate if the value of the property is more than £40,000.

If there is a mortgage

You’ll also need the consent of your mortgage lender.

When you add another person to the title of the property, they become liable for the mortgage. On the other hand, if you’re removing someone from the property title, the remaining owner becomes responsible for the mortgage.

The mortgage lender will need to be satisfied that the remaining or new owners are able to carry on paying the mortgage payments.

We’ll contact your mortgage lender on your behalf and ask for written consent to the transfer. Before consenting to the transfer, they might change the terms and conditions of the mortgage.

If your mortgage lender refuses to agree to the title transfer, you’ll need to pay off the mortgage first, either with a cash payment or through re-mortgaging with a different lender who agrees to the transfer.

How long does a Transfer of Equity take?

At Rothera Bray, we know the importance of completing property transactions quickly. Especially when it’s a family home.

In most cases, a transfer of equity takes 4-6 weeks. That said, every transaction is unique so each one can take a different length of time to complete.

For example, if there’s a mortgage involved, it’s likely to take longer than if there’s no mortgage.

How much does a Transfer of Equity cost?

When transferring equity, there are two costs:

1. Your solicitors fee (our fees are transparent), and
2. The Land Registry fee

Other fees might apply but this depends on the transfer. For example, if you’re applying for a new mortgage, then you’ll need to pay for the search fees. Also, depending on the amount of equity in the property, it may be subject to Stamp Duty Land Tax.

We will discuss any and all potential fees with you at the very start so you know exactly how much it will cost and when.

Why use Rothera Bray for Transfer of Equity?

We have an experienced property and conveyancing team and a network of eight offices operating across Nottingham, Leicester and Derby.

When you instruct us to act on your behalf, we’ll assign a team member and give you access to their direct phone number and email address.

They will look after the transaction from beginning to end and keep you updated on progress at all stages of the process. They will also let you know about any communication with third parties such as mortgage lenders or where any third party disbursements such as stamp duty are payable.

We can also assist with mortgaging the property where required.

Once the transfer of equity is complete we will make an application to the Land Registry to register the new ownership of the property on your behalf.

We can advise you on Stamp Duty.

We can also draw on the experience of our Wills, Probate and Trusts and Family Law teams where needed to provide you with a comprehensive service that addresses all of your queries, including advice on inheritance tax and capital gains tax.

Our fees are transparent and we speak in plain English. You’ll always know how much you’re paying and where the transaction is up to.