Paragon Mortgages transfer of equity: q and a’s

• My current mortgage is with Paragon Mortgages. Can I transfer equity to someone under 18 years old?
• What can I do where I am not happy with the conveyancer who handled my transfer of equity transaction?
• My wife and I have 50:50 shares in a investment property. I am a higher rate tax payer. Preferably I would like to do a transfer of equity into her name with a view to reduce our tax on the letting income. Assuming Paragon Mortgages are happy with this the legal fees are inexpensive. What are the implications when we dispose of the property? As I would no longer be on the title documents would I lose my CGT relief.
• Will I have to pay any fees for a Transfer of Equity where the current mortgage is with Paragon Mortgages?
• I purchased a property with my cousin in 2008 Since purchasing the property, we have both got married. We are now intending to do a transfer of equity so my name comes off the Paragon Mortgages mortgage. There is a significant difference between the value the lender say and what the property would sell for currently. Can you offer any advice?
• I already have a home loan with Paragon Mortgages and am maintaining my existing mortgaging but seeking to have have the equity transferred to my name only so my ex will no longer be on the mortgage. How long does the whole transfer of equity process take?
• My Paragon Mortgages home loan we jointly entered into with ex, he has agreed to be removed and put the house in my name alone. Paragon Mortgages will permit the transfer of equity to my individual name. Do Paragon Mortgages contact my company to verify my salary?

Sample of questions in a conveyancer form relating to Paragon Mortgages Transfer of Equity

Caveats to be read in further to the above Paragon Mortgages transfer of equity Info :

Tax and Legal

There may be various tax and legal implications when transferring equity for your property. You should always seek the advice of a solicitor on the Paragon Mortgages conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold titles

If your property is leasehold, provisions in the lease may require that you have a license to do so from the freeholder. If such conditions are not complied with you may be in violation of your covenants under the lease. This could trigger the freeholder taking enforcement action against you.

Indemnity Insurance

If the transfer of equity is made pursuant to an Order of the Court, then Insolvency Indemnity Insurance is not required. In other cases, where a property is being transferred at less than market value between joint owners, an Insolvency Act Indemnity Insurance policy may be required. This is something that that your conveyancer will check with Paragon Mortgages This is because, if the outgoing party is made bankrupt in the future, their Trustee in Bankruptcy could argue that they had transferred the property in order to avoid their creditors and apply to the Court to have the transaction set aside. If this happens, it could affect your lender or a future buyer from you as they would lose the property and the lender may not get back what they have loaned to you. The Insolvency Act Indemnity Insurance policy only protects lenders such as Paragon Mortgages or future buyers from you. If there is no mortgage and the outgoing owner is made bankrupt, there is a risk to you that you could lose your home if the transfer is set aside. The cost of the Insolvency Act Indemnity Insurance policy varies based on the valuation of the property at the conclusion of the transfer of equity transaction.

Preparing the Transfer of Equity with a Paragon Mortgages Mortgage

When it comes to preparing the the Land Registry documents your conveyancing solicitor should in the ‘consideration’ panel choose the first option, if consideration is given; otherwise ignore the consideration panel altogether.

If Paragon Mortgages is joining in the transfer to release someone from liability, put the release in the ‘additional provisions’ panel if someone is entering into a covenant relating to the charge, place it in the ‘additional provisions’ panel stamp duty land tax is not payable when there is no chargeable consideration for the transfer (Schedule 3, paragraph 1 of the Finance Act 2003). In the case of a transfer subject to a charge (even if the transfer is by way of gift) or if a property has been transferred for no value and there is an associated discharge, HMRC would view this as an assumption of an existing debt by the purchaser (Schedule 4, paragraph 8 of the Finance Act 2003) and stamp duty land tax may be payable if you wish you may state in the ‘additional provisions’ panel that ‘This transfer is made subject to a charge dated… in favour of…’

On form AP1, your lawyer should describe the transfer as ‘transfer of equity’ to assist Land Registry staff.

Information provided on this webpage is for general information and only applies to England and Wales. It does not constitute advice for members of the public who should contact their lawyer,mortgage broker, insurer and accountant for specific advice relating to transfer of equity. Whilst we endeavour to keep the information up to date and correct we do not make any representation or warranties of any kind about its completeness, accuracy, reliability or suitability. Any reliance you place on the information is strictly at your own risk. Lexsure will not be liable for any direct or indirect loss or damage arising out of or in connection with the use of this information.