Transfer of Equity
A transfer of equity is the process of transferring ownership of a share or interest in a property from one person to another.
Transferring equity can feel like a complex process, but with the help of the conveyancing solicitors at AWH Solicitors you can be assured the process will remain clear and simple.
That clarity starts right here. We want you to feel comfortable with the transfer of equity process and explain why our solicitors are the right fit for you.
Understanding Transfer of Equity
The transfer of equity
A transfer of equity is the term given to legally change some or all the ownership of your property.
The transfer of equity process will involve another person being added to or removed from the title of the property.
There are several situations in which you would require a transfer of equity. Such situations could be:
- Your cohabitation arrangements are changing. For example:
- Your spouse or partner moves in and you wish to legally share ownership of your property by adding them to the property title, or
- You get divorced or separated and want to transfer your co-owned property to just one owner
- Transfer of property between family members, for example to your children
- A court order
- A financial advisor has recommended transferring your share of the property
Unsurprisingly, the transfer of equity affects everyone involved and entrusting the process with a legal team can seem somewhat daunting. However, with our experienced conveyancing solicitors taking you through the transfer of equity, you can expect a supportive, smooth and efficient process.
- Your cohabitation arrangements are changing. For example:
What is the equity of your property?
When talking about equity in property we speak of the value of the property once the outstanding mortgage sum is subtracted.
For example, if your home costs £250,000 and your outstanding mortgage sum is £150,000, the equity is £100,000. If you co-own or want to co-own a property, you will split the equity value and not the property value as a whole.
What is involved in the transfer of equity process?
Each transfer of equity process will differ depending on the situation at hand. Generally, the process would include the following steps:
- Your conveyancing solicitor will request an official copy of your property’s title documentation. This is held by the Land Registry, which safeguards land and property ownership
- Your conveyancing solicitor will review and verify the document and prepare the transfer of equity deed
- Your conveyancing solicitors will check the document for any outstanding mortgages on the property
- Where the property has a mortgage, the mortgage lender will also need to consent to the transfer of equity before the next stage. That’s because the person added to the property title becomes equally responsible for the mortgage. If the property ownership is being transferred to one person, they will become solely responsible for the mortgage
- If there is no mortgage or once the lender has consented, the property’s existing and new owners will be able to sign the transfer of equity deed in front of a witness
- The conveyancing solicitor will register the transfer of equity deed with the Land Registry
- For properties with a transfer sum over £40,000 you will be charged Stamp Duty Land Tax
If it all seems a bit overwhelming, that’s okay. Fortunately, you don’t need to handle this process by yourself, as we are here to guide and support you through the process with ease.
Stamp Duty Land Tax (SDLT)
In England, Wales and Northern Ireland you are required to pay Stamp Duty Land Tax when you buy a residential property that is worth £125,000 or more.
Stamp Duty Land Tax needs to be paid on residential property no matter if it is on leasehold or freehold, bought outright or with a mortgage.
During a transfer of equity a share of the property ownership is transferred to a new party, which is why SDLT may need to be paid at this stage, even if SDLT was paid during the initial purchase as well.
How long it takes to transfer equity
A straight-forward transfer of equity would generally take between four and six weeks, however as each transaction will be different it could take longer.
For example, when there is a mortgage open on the property the process will likely take more time.
Our residential conveyancing solicitors will ensure the process is completed in a timely manner so you and your family can have peace of mind everything is arranged.
Our conveyancing solicitors will guide you through the conveyancing process with care and ease whilst ensuring all processes are completed in a timely manner.
In addition to offering our guidance and advice throughout the process of transferring equity, our solicitors also provide their services for the buying and selling of property, buying of new builds, the re-mortgaging process and the buying process through the right to buy scheme.
Additionally, to those who require this, our solicitors can offer these services to muslims living in the UK in compliance with sharia law.
The Transfer of Equity Process
Obtaining copies of the title deedsYour solicitor will request the official copies of the title deeds from the Land Registry, reviews and verifies the documents and prepare the transfer of equity deed.
Getting the mortgage lender's consentAs the person added to the property title will become partially responsible for the outstanding mortgage, the mortgage lender will also need to consent to the transfer of equity.
The transfer of equity deed registrationAfter the mortgage lender has consented and all documentation and checks have been completed your solicitor will register the transfer of equity deed with the Land Registry.
Paying Stamp Duty Land TaxDepending on the value of the property SDLT will be paid.
AWH Solicitors Conveyancing
With something as important as transferring equity, being able to trust your legal advisors is essential, as you need to know that you and the deeds to your property are being handled with care and integrity.
At AWH Solicitors, we do exactly that.
To learn more about the transfer of equity process, or to get things started, contact the team at AWH Solicitors today.
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