Transfer of Equity


When you’re involved with a Transfer of Equity, it will depend on whether your name is coming off the title or you’re the person whose name is staying on the title as to what legal advice you require.

If your name is coming off the title, you will be asked to sign a Transfer. You will need to sign this in the presence of an independent witness, so someone who is not a family member or connected with the transfer in any way. The solicitor who has drafted the Transfer on behalf of the person who is staying on the title will not be able to provide you with legal advice about the document, so it is highly recommended that you obtain your own legal advice before you sign anything. You need to be sure that you understand what you are signing and that everything is correct.

Your solicitor will check over the title for the property and the document you are being asked to sign. If you are also coming off any mortgage that’s secured against the property, your solicitor will ask for confirmation that you will be released from all liabilities and responsibilities in connection with the mortgage once the transfer is dated and completed.

Your name will not be officially removed from the title for the property (and any mortgage) until the Transfer has been signed by all relevant parties and dated. It can then be sent to HM Land Registry so that the register for the property can be updated accordingly. Your solicitor will ask the other party’s solicitor to send them a copy of the updated Register once this is available so that you have confirmation that your name is no longer associated with the property

If you are the person who is staying on the title, you will need to instruct a solicitor to draft up the Transfer and send this to the person who is being removed from the title for signature. It may be that there is already a mortgage on the property and this is being transferred into your sole name, in which case you will need confirmation from the lender that they are happy to do this. Alternatively, you might be remortgaging with another mortgage lender to cover the outstanding debt on the property plus any lump sum which is payable to the person coming off the title.  If this is the case, you will need a mortgage offer and your solicitor will need to ascertain how much is due to repay your current mortgage to make sure there are sufficient funds.

If a property is being transferred in accordance with a court order on a divorce or separation, then the transfer will be exempt from paying stamp duty land tax (as long as the parties involved as per the court order are the only parties to the transfer). However if the transfer is not in accordance with a court order then it may be the SDLT is payable on the transaction. This will depend on the individual circumstances of the parties and the sums and/or mortgages involved.

It’s also worth bearing in mind that if your property is leasehold then you will need to serve notice on your freeholder to let them know the change in ownership of the property, and you may also need consent from your freeholder before transferring the property.

Suzanne Dixon is a Senior Associate in the residential conveyancing department at Sintons. To speak to Suzanne, please contact her at suzanne.dixon@sintons.co.uk or 0191 226 7805.


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