Transfer of equity
dedicated transfer
of equity team"
David Parton, Partner
There are several situations in which property owners may wish to undertake transfers of equity:
- marriage - you wish to add your new partner's name to your deeds
- divorce - you wish to remove your co-owner's name from the title deed
- tax planning - you have been advised by your financial adviser or accountant to undertake a transfer of equity to reduce future inheritance tax liabilities or take advantage of personal capital gains limits in the event of the future sale of the property
- transferring or changing - you wish to change the percentage owned by co owners
Why use Access Legal from Shoosmiths?
Undertaking transfers of equity can be complex, and it's important it's undertaken and completed correctly.
Tax implications
Undertaking transfers of equity can have tax implications for you and those involved.
Some transfers will be considered a gift or a transaction at under value. Depending on the value of a share in the property there may be stamp duty to pay.
Some transfers of equity are exempt from stamp duty, for instance where a property is being transferred as a result of a court order following divorce proceedings. We can advise you on whether you'll have to pay stamp duty.
To check current stamp duty rates visit www.inlandrevenue.gov.uk
Mortgaged properties
If you're considering changing the ownership of a property and a mortgage is held against it, you'll need to seek your lender's approval. Your lender will want to ensure the remaining owners or new owners provide adequate security. Often lenders will charge administration and valuation fees for this. They'll insist on a solicitor undertaking the legal aspects of the transaction.
In certain situations you may find it better to get remortgaging advice and remortgage your property. By doing this it'll allow you change the ownership of the property and take advantage of a more attractive mortgage deal, thereby offsetting all or some of the costs involved in transferring ownership.
Insolvency law
If transfers of equity are effectively a gift of equity in the property, the law allows for transactions to be set aside if the person making the gift becomes bankrupt within two years of the date of the gift (five years if the bankruptcy was known or imminent at the time of the transfer). We can advise on how insolvency law will apply to you and in some cases may recommend title insurance in certain circumstances.
Contact us
We regularly handle transfers of equity for clients and our experts will protect your interests and keep you fully advised of the implications.
Whatever your circumstances, we can advise you.
