TSB transfer of equity: q and a’s

• My brother and I got a joint mortgage with TSB on a apartment a couple of years ago. I am now thinking of purchasing a flat by myself and my friend would like to buy me out. Once we have agreed a figure where do we go? Is there likely to be any issue with TSB with him being solely liable for the total loan rather than only half of it?
• Is it sensible to stop my mortgage payments with TSB once a date for my remortgage and transfer of equity has been agreed?
• Will I incur any charges for a Transfer of Equity where the existing mortgage is with TSB?
• I currently have a joint TSB mortgage with my step-brother and am investigating the possibility of him taking on the whole mortgage and subtracting myself from it, so as to enable me to buy a place with my fiance. The outstanding mortgage is approx 300k, and the property value is approx 600k. Is this a transfer of equity? Is land tax involved?
• I already have a mortgage with TSB and am keeping my current mortgaging but applying to have have the equity transferred to my name only so my former husband will no longer be on the title. How long can it take for the application to be processed?
• TSB yesterday agreed I can take over the mortgage on the flat. I had applied for a transfer of equity but presumably there is a transfer of ownership at the Land Registry on top?
• My mum passed away seven months ago leaving a mortgage-free property to me and my half brother in equal shared. He has always lived in the property, there was a condition in the will saying the premisescould not be sold for 2 years following her passing so he could remain there for a prescribed period. He now wants to remain in the house beyond the prescribed period. We have discussed a transfer of equity. Am I right in saying we'd get a valuation then he'd get a home loan in the traditional way to buy my half from me?

Examples of questions in a conveyancer form relating to TSB Transfer of Equity

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

Tax and Legal

There are numerous potential tax and legal implications when transferring equity for your property. You should always seek the advice of a solicitor on the TSB conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold premises

Should the tenure of your property be leasehold, provisions in the lease may have a requirement for notices to be served and that you have a license to do so from the freeholder. If such terms are not adhered to you may be in breach 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 TSB 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 TSB 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 conveyancing.

Preparing the Transfer of Equity with a TSB 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 TSB 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 should not be regarded as 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.