Questions and answers: Vida Homeloans transfer of equity

• Me and a friend got a joint mortgage with Vida Homeloans on a apartment a couple of years ago. I am now thinking of buying a flat by myself and my friend would like to buy me out. Once we have agreed a figure what happens next? Is there likely to be any issue with Vida Homeloans with him being solely liable for the total loan rather than only half of it?
• Is it possible to transfer the equity held in my property with my Vida Homeloans mortgage?
• I am am in need of a conveyancing solicitor to deal with my transfer of equity. Vida Homeloans have been approached for a refinancing. I considered asking my mortgage broker. I understand he will likely receive a kickback for recommending someone, but also of benefit will be that he knows the conveyancing solicitor, has a working relationship with them. Is my logic misguided?
• At what stage do I incur stamp duty payable for the transfer of equity in my house in my name alone which is happening simultaneously with a remortgage via Vida Homeloans?
• Vida Homeloans have today agreed I can take over the mortgage on the house. I previously applied for a transfer of equity but presumably there is a transfer of ownership at HMLR as well?
• I am led to believe we would need at least AP1 and TR1. Is this true?
• After 2 a couple of years estranged I have made the decision to relinquish up my interest in the apartment to my husband who is re-mortgaging with Vida Homeloans. Could this transfer of equity be done in less than four weeks?

Questions that your conveyancer is likely to ask regarding your Vida Homeloans Transfer of Equity

Important warnings to consider in further to the above Vida Homeloans 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 Vida Homeloans conveyancing panel and accountant before transferring equity.

Transfer of Equity Conveyancing for Leasehold premises

If your property is leasehold, the lease may have a requirement for notices to be served and that you obtain the consent of the landlord. If such terms are not adhered to you may be in violation of your covenants under the lease. This could potentially result in the freeholder taking enforcement action against you.

Indemnity Insurance

If the transfer of equity is made as a result of an Order of the Court, then Insolvency Indemnity Insurance is not required. In other situations, 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 Vida Homeloans 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 Vida Homeloans 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 is dependent on the market value of the property at finalisation of the transfer of equity transaction.

Preparing the Transfer of Equity with a Vida Homeloans Mortgage

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

If Vida Homeloans 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.

Content 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.