Transfer of Equity

When changing hands, needs a helping hand.

What is Transfer of Equity?

Transferring equity mean’s you’re transferring your equity (money) in the property to someone else.

Who can I transfer equity to?

You might transfer equity to:

  • • Add your spouse to your property’s deed if you have recently married or remarried
  • • Remove your ex-partner from the deed if you have divorced

  • • Change the percentage shares owned by the co-owners of a jointly owned property or buy out a co-owner’s share in the property
  • • Reduce future inheritance tax liabilities or take advantage of personal capital gains limits

What is equity?

Equity is the value of your property minus the outstanding mortgage amount.

Example: If your property is worth £500,000 and your outstanding mortgage amount is £200,000, then your equity in the property is £300,000.

The process…

See below the process for transferring equity in your home.

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1

Obtaining a title for the property

First, we'll need an official copy of the title for the property, we'll check if there's a mortgage on the property and if there's any restrictions.

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2

Appointing a Conveyancer

After you've appointed a conveyancer, we can help you with this if needed. They will then:

  • Add your spouse to your property's deed if you have recently married or remarried
  • Remove your ex-partner from the deed if you have divorced

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3

Mortgage or no mortgage, that is the question.

If there's a mortgage on the property, then you'll need the consent of the mortgage lender to go ahead with the transfer of equity. This is because if you are adding someone to the title, so they'll become equally liable for the mortgage.

If you're removing someone from the title, then they'll pass their liability on to the remaining owners of the property; the mortgage lender will want to check that remaining owners are able to maintain mortgage payments before agreeing to the transfer, so they'll have to meet the affordability criteria.

Your conveyancer will contact the mortgage lender and request written consent to the transfer.

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4

Other scenarios

If the mortgage lender does not agree to the transfer, then you'll need to repay the mortgage before you can go ahead with the transfer. This can either be with a cash payment or a remortgage with a different lender who agrees to the transfer, we can assist in finding a lender to remortgage the property.

If there are no mortgages on the property, the existing and new owners of the property need to sign the transfer deed in the presence of a witness, then the conveyancer registers the transfer deed at the land
Registry. A stamp duty certificate is needed if the value of the transaction is over £40,000