Transfer of Equity

Transfer of Equity involves legally changing the ownership of your property to either include or remove one or more people other than themselves from the property register.

The term “Equity” is simply the residual value of the property after any mortgage is deducted from the current market value.

For example, if your property is worth £350,000 and you have an outstanding mortgage of £150,000, you have £200,000 equity in the property.

A transfer of equity is often linked with a remortgage of your property and your new lender might have suggested that you proceed with the transfer under its fees assisted remortgage scheme so that the same Solicitor acts for both the new Lender and you in connection with the transfer of the property and remortgage to ensure that they happen at the same time.

Why might you wish to transfer equity?

There are any number of reasons why you might wish to transfer equity in a property, such as a marriage or divorce.

The transfer of equity conveyancing process

Once all parties are in agreement, an official document called a Transfer Deed TR1 is drafted for all parties to sign. Any new mortgage formalities are also completed. If the new owner or part-owner is taking out a new mortgage, then we would also represent the lenders interests in completing this.

Transfer of equity matters are often accompanied by a remortgage. In these cases, Solex Legal Services will treat the transfer of equity and remortgage as a single transaction, aiming to complete this as soon as possible.

After the Transfer Deed has been signed

The post completion formalities with a transfer of equity are similar to those carried out on a purchase. An SDLT Form (Stamp Duty Land Tax Return) may need to be completed even if no payment is due in connection with the transfer to a party coming off the property register. This is particularly the case if at the time of the transfer there is a mortgage debt secured on the property and at least half of the debt exceeds the minimum SDLT threshold.

The next stage is to register all interests and new mortgage over the property at the Land Registry, at which point the property is formally registered in the new parties' name(s).

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