A transfer of equity is usually a transfer of a property from joint names into the sole name of one of the owners, for example, a change of ownership following a relationship split or the formation of a new relationship.

It may be a transfer between family members such as gifting property / transferring ownership of a property from parent to child or when a trust comes to an end on the coming of age of a minor child. Often a transfer of equity is combined with remortgaging the property. Sometimes transfers of equity take place for tax planning purposes.

There can be tax implications of this type of transaction and you should seek financial advice.

Guidance on Your Transfer of Equity Process

This is where our property solicitors step in. Our job is to remove the stress from you to ensure your transaction proceeds quickly and smoothly every step of the way to achieve your goal.

We have Tax & Trust Planning specialists who will be able to assist you with tax planning issues arising on the transfer of property into or out of joint names.

Depending upon the type of transfer of equity will determine what we have to do for you to complete the transaction.

Transfer of equity process

If you are combining it with a remortgage, we will probably be acting for your new lender as well. Although you already own the property, we will have to carry out our “due diligence” on behalf of your new lender. We will check the legal title to the property and carry out various searches. We will liaise with your mortgage lender regarding your mortgage offer and their requirements.

Handling Divorce and Mortgage Changes

If your property transfer is part of a divorce, there may be strict timescales to adhere to contained within the court order. In some cases, the agreement releases one party from the mortgage, and the other party then takes on the mortgage payments solo. We will liaise with your mortgage lender to ensure the transfer of equity meets their requirements and obtain their consent to the transaction. They may wish to be a party to the transfer.

When adding a new party to the title where an existing mortgage exists, the lender will require adding the new party to the mortgage, and signing a new mortgage deed might be necessary. We will check with your lender what they require.

Stamp Duty Land Tax (SDLT) is not usually payable on a gift of property between parties or where the transfer results from a matrimonial court order. Where there is a transfer of equity and the incoming party is paying for their share, or where there is a current mortgage on the property, SDLT may be payable (if the amounts involved exceed the SDLT threshold). The SDLT is calculated on the amount paid or the share of the mortgage debt being taken or, if applicable, both.

We will keep you informed as the transfer of property progresses. After completing the transfer and remortgage (if applicable), we will send the necessary funds to the Revenue for the SDLT payment (if applicable) and organize the registration of the transfer (and new mortgage) at the Land Registry. Once registration at the Land Registry is complete we will let you have a copy of the new title entries showing the new registered proprietors’ names.

How long does a transfer of equity take?

This is the ultimate “how long is a piece of string” question. Every transaction is different with its own challenges. Transactions proceed quickly without a lender involved, but lender requirements can extend the process for others. Where there is a court order in place we will endeavour to adhere to the time frames laid down by the court.

Our wealth of experience over many years enables us to assess how long a transfer of property will take. On average we advise our clients that it will take approximately four weeks from receipt of instructions to complete the transfer of equity and apply for registration of the title at the Land Registry.

If you do have a particular timescale that must be met, we will seek to achieve that for you.