Changing Ownership Arrangements/Transfer of Equity

Our team of expert property lawyers will make transferring your property as straightforward as possible. Securing the right property lawyer is vital.  We provide a highly personalised service which meets your needs and exceeds your expectations.

A transfer of equity is the process by which someone is either added to or removed from ownership of a property. Equity is the legal term for the percentage of the property you own.

There might be various reasons for wanting to transfer your equity for example:

1. Solely owning a property, getting married and wishing to add your spouse to the deeds. This might either be a gift or they might give you some “Consideration” (see below what this means).
2. Transferring a property due to a divorce or dissolution of a civil partnership. This might be subject to a Court Order or by amicable agreement.
3. Parents transferring property by way of a gift to children as part of their lifetime tax planning.
4. Owning a property jointly with someone else and they pass away. It may be necessary to transfer the property. In some cases, ownership will pass automatically, but in other situations a Transfer or Assent will be needed.

Our Wills & Inheritance Protection Team can advise you on gifting to children or loved ones, making a will, and tax planning.

What is Consideration?

‘Consideration’ is money or anything that has money’s worth.  In most cases, property is transferred for an agreed sum of money, based on its current value. Consideration also includes the relevant proportion of any mortgage that the transferring party is being released from. For example, if a property worth £500,000 with a mortgage of £200,000 is being transferred from a sole owner to that owner and someone else, and each are to hold 50% of the property, the consideration will be £350,000 This is half the property value and half the existing mortgage debt.

What is the process of a transfer of equity?

The transfer of equity process is relatively straightforward and involves the following steps:

1. Instruct a reliable conveyancer - Get in touch today for more information about transfers of equity and how we can help you.
2. ID Checks and compliance - This can be completed at one of our offices or remotely using secure links to our ID checking software.
3. Review the title deeds - We will check the title deeds for any restrictions that need to be complied with or other entries that may need attention.
4. Prepare the Transfer Deed - This is usually done by the solicitor acting for the person receiving the property (where both parties are separately represented).
5. Notify any mortgage lender - This is where we will ask for the mortgage lender’s consent for any mortgage that is to remain on the title after completion.  Mortgage lenders can have certain requirements that must be met before the transfer can take place.
6. Signing the Transfer Deed - Once the Transfer Deed is agreed, you will need to sign it in the presence of a witness.
7. Agreeing a completion date - This is the date the transfer formally completes and money changes hands (if any).
8. Register the Transfer Deed at the Land Registry – The Land Registry will register the new ownership and provide a copy of the updated title.

Other aspects to consider

Stamp duty - Stamp duty is calculated based on the ‘Consideration’ as discussed above.  If the total consideration is above the Stamp Duty threshold (currently £250,000) stamp duty will be payable. If the amount is over £40,000 (but less than £250,000) there may be no stamp duty to pay.  HMRC’s rules for stamp duty payable in connection with ‘additional property’ must also be considered.

You don’t pay stamp duty if you transfer the property under a Separation Agreement or Court Order because of divorce or the dissolution of a civil partnership.

Tax implications - We recommend that you seek advice from an accountant or financial adviser about any other tax implications of the transfer. In certain circumstances we also suggest (or insist) that, for your protection, our Wills and Probate Team advise you further, particularly where the transfer is to take place by way of gift.

Lender consent - In relation to transferring a property with a mortgage, you will require lender consent before proceeding. This applies to both adding someone to the deeds or removing them. Before providing consent, the lender will need to be satisfied that the remaining owner is able to afford the mortgage on their own. If someone is being added to the deeds, the lender will need to check affordability, credit history, and identity of the person you wish to add.

Why choose Biscoes?

Every client benefits from a designated lawyer to oversee the transaction from the point of instruction through to completion.  We also have an internal locum who provides cover in the event your designated lawyer is unwell or on holiday, to ensure there is no delay to your matter.

Crucially, we are proactive on your behalf and will communicate with your mortgage lender, your mortgage broker and other parties to complete the transfer as quickly as possible.

Our Residential Property Team has many years of experience dealing with Transfers of Equity across Portsmouth, Hampshire, the Isle of Wight and beyond. Biscoes is a member of the Law Society’s Conveyancing Quality Scheme (CQS) which is a recognised quality standard for firms in the industry undertaking residential conveyancing.  The scheme is recognised by the various financial bodies such as The Council of Mortgage Lenders and Building Societies Association, meaning that we are able to deal with the vast majority of mortgage lenders on your behalf.

We will provide a full breakdown of the likely costs of the transaction at the outset.

For further information, please do not hesitate to contact our Residential Property Team on 02392 660261.