Transfer of Equity is done when you as a property owner wish to add one or more people to your property ownership or legal title of your property. This process can also happen when you wish to remove one or more people from the property title. Although the process doesn't always involve transferring money, it does involve a fair number of steps along with a good amount of paperwork. To help you better understand how it works, we have put together a simple guide to Transfer of Equity.
A Guide to Transfer of Equity
Wondering how Transfer of Equity works? Not sure how to go about getting started? This short guide will answer your questions and show you how to how best to proceed.
What is it?
Simply put, this process applies to jointly owned property. When you wish to transfer the ownership of the property to another person or transfer the ownership of the property from one person to another, this is the procedure that will follow. In short, equity is a term that determines your ownership of the property. This would be the value of the property, excluding the currently owning mortgage. If your home is worth £350,000 and you have a remaining mortgage of £190,000, your equity would be £160,000.
What steps are involved?
The first step in transferring your equity is to find a solicitor, who will complete the process on your behalf. Once your solicitor is instructed through In-Deed, you will be given documents to complete and send back. Your solicitor then liaises with the other party's solicitors to negotiate the transfer. From there, all parties are required to agree to the transfer. A Deed of Transfer is drafted and all parties sign the document. This lays out the various legal terms outlining ownership for each party. If a new mortgage or a remortgage is needed, terms for this must be completed before the Deed of Transfer is signed.
Once this deed is signed, the transfer is officially complete. Your conveyancer then finalises the transfer, sending a Stamp Duty Land Tax return to HMRC and registering any new charges and interests related to the property at HM Land Registry. At this point, the property is formally transferred to the new owners.
When do you need it?
This process is typically required in any case where someone needs to be removed or added to the legal ownership of your property. If you have recently married or you wish to add your partner to your property ownership, this is the process you will take. Parents may wish to add children to their property ownership. Likewise, if you are recently divorced, you would need to complete this process to remove a former spouse or property owner from your property deed.
How do you get started?
The best way to get started is to get assistance from a trusted conveyancing solicitor who can take you through the process. In some cases, the transfer can be simple but in other cases, it may be more complicated. Getting help from an expert such as Home Legal Direct will make Transfer of Equity far simpler.