Precise Mortgages transfer of equity: q and a’s

• My decree absolute is through as is the consent order. Now I must address the transfer of equity at the HMLR and the Precise Mortgages home loan. I have contacted Precise Mortgages for the transfer of equity forms. What are my next steps?
• Online research suggests that solicitors are more expensive than conveyancers for transfer of equity conveyancing. Am I better of using a conveyancer or a solicitor where I am transferring equity and at the same time remortgaging with Precise Mortgages
• Precise Mortgages yesterday agreed I can take over the mortgage on my home. I have applied for a transfer of equity but is this a transfer of ownership at HMLR as well?
• Can I transfer the equity held in my property with my Precise Mortgages home loan?
• My former wife are looking to get a lawyer in place for a remortgage with Precise Mortgages. Transfer of Equity conveyancing is also requiredI have used the different comparison based tools and the results are from all over the country. Is it important to instruct a conveyancing solicitor local to us?
• At what stage do I pay stamp duty chargeable for the transfer of equity in my house in my name alone which is happening simultaneously with a remortgage via Precise Mortgages?
• My wife and I have 50:50 shares in a BTL. I am a higher rate tax payer. Ideally I would like to complete a transfer of equity to her sole name to reduce our tax on the letting income. Assuming Precise Mortgages are happy with this the legal fees are not prohibitive. However what happens when we sell? Would my GGT relief be lost.

Sample of information requested in a conveyancing solicitor form concerning a Precise Mortgages Transfer of Equity

General Advice to read in supporting the above Precise 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 Precise Mortgages conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold properties

If your property is leasehold, 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 the lease. This could potentially result in 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 lawyer will check with Precise 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 Precise 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 time of completion of the transfer of equity transaction.

Preparing the Transfer of Equity with a Precise Mortgages Mortgage

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

If Precise 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.