Paragon Mortgages transfer of equity: q and a’s

• My existing home loan is with Paragon Mortgages. Can I transfer equity to someone under eighteen years old?
• I own a house in Witham , with a Paragon Mortgages mortgage with my ex partner. He and his new partner are going to buy me out. We had consent from Paragon Mortgages to remove my name with hers. The transfer of equity has to be completed by a lawyer for Paragon Mortgages (supposedly). Is it possible for us to do the Land Registry change?
• What can I do where I am dissatisfied with the conveyancer who conducted our transfer of equity conveyancing?
• My brother and I got a joint mortgage with Paragon Mortgages on a flat in 2013. I am now looking to get a apartment on my own and my friend would like to buy me out. Assuming we can agree a price what happens next? Would there be any potential problem with Paragon Mortgages with him being responsible for the total loan rather than only part of it?
• I got divorced in 2011. I simply never got around to change the ownership from both our names to just in my name. I am ready to do that and so is she. Transfer-of-equity is needed. Paragon Mortgages is content to transfer the full equity in my name (financial checks done). Does she need a conveyancer?
• Is there such a thing a transfer of equity stamp duty calculator?
• My fiance and myself have 50:50 shares in a buy to let. I am a higher rate tax payer. Preferably I wish to do a transfer of equity into her name in order mitigate tax on rental income. If Paragon Mortgages are happy with this the legal fees are not high. What are the implications when we sell? Would my GGT relief be lost.

Sample of information requested in a conveyancing solicitor questionnaire concerning a Paragon Mortgages Transfer of Equity

Caveats to be read in supplemental the above Paragon Mortgages transfer of equity Advice :

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 premises

Should the tenure of your property be leasehold, the lease may have a requirement for notices to be served and that you obtain the consent of the freeholder. If such conditions are not complied with you may be in breach 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 conveyancing solicitor 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 market value 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 conveyancer should describe the transfer as ‘transfer of equity’ to assist Land Registry staff.

Information contained within 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.