Understanding your Transfer of Equity

Confused about what a Transfer of Equity is? Unsure about what happens and what you need to do? This article will help you understand this process in more detail.

What is a Transfer of Equity or Transfer of Title?

A Transfer of Equity or Transfer of Title is when someone is added or removed from ownership of a property; this could be one owner adding a husband or wife, a parent, adding a son or daughter, or a separating couple removing one of them (i.e. the outgoing party) from the property ownership.

What is the Transfer of Equity process?

The process can be different depending on each individual case and type of transfer. For example, on a Transfer of Equity from joint names to one name, we’ll send you a Transfer of Equity pack for you to complete and return. If you decide to instruct us to act for you, we’ll issue the Transfer (TR1) and other documents to the outgoing party or the outgoing party’s solicitors. Once we receive this back, we’ll then send the TR1 to you for you to sign and return. When you have signed and returned the TR1, your case will be reviewed for a potential completion date, unless there are other matters outstanding.

Can I use my own solicitors?

Yes, you can choose to use a different firm of solicitors to act for you in the Transfer of Equity. Please refer to Option B of the ‘Your Options’ Form where you’ll find further information. There may be times when we’re unable to act for you in the Transfer of Equity and you’ll need to appoint a different solicitor to act for you. Don’t worry – if this happens we’ll let you know and talk you through the reasons why.

Why does the outgoing party need a solicitor?

Your new mortgage lender may need the outgoing party to instruct a solicitor to act for them. If this is not the case the outgoing party may still choose to instruct a solicitor, as we do not act for them at all. In our paperwork to the outgoing party, we do recommend that they speak to a solicitor about the transaction.

How much does it cost?

You’ll find our fees in the ‘Terms of Engagement Authority’ section of the Transfer of Equity Questionnaire.

Where should the outgoing party sign?

The outgoing party will have been sent instructions to help them to complete all the documents that we’ll need.

What is Stamp Duty Land Tax (SDLT)?

In England, Northern Ireland and Wales you’re liable to pay Stamp Duty when you buy a residential property, or a piece of land, that costs more than £125,000 (£40,000 for second homes).
This tax applies to both freehold and leasehold properties – whether you’re buying outright or with a mortgage. Visit Gov.uk for more information.

You pay tax when you:

Why do I need to pay Stamp Duty Land Tax (SDLT)? I paid this when I bought the house.

You may still need to pay SDLT in a Transfer of Equity as you are acquiring a share in the legal ownership of the property. Section 5 of the Transfer of Equity Questionnaire has more details about how SDLT is calculated.

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