What is a Transfer of Equity?

Equity is a legal term which refers to the percentage of legal ownership you have in a property or land. The level of Equity you own is usually dependent upon the amount that remains outstanding on your mortgage. In practise a Transfer of Equity occurs when a property owner seeks to add or remove a person to or from the legal title and thereby transferring their equity.

In practise a Transfer of Equity usually occurs in the below examples:

• Adding spouse to the title.

• Removal of spouse following a divorce or split.

• Transferal of inheritance.

• Transferring property to family/children and others.

• Transfer of gift.

A Transfer of Equity does not typically involve a transfer of funds and it is usually done by way of a gift. However, in the event a person is coming off the title, they can be 'bought out' and additional financing can be sought to do so.

In the event there is a mortgage on the property, lender consent will need to be obtained prior to the Transfer taking place.

1. The first step is to instruct your solicitor. Your solicitor will supply you with an initial pack which includes a CCL amongst other key documents confirming instruction in the transaction. Upon receipt of the documents, sign and return these to your solicitor.

2. Complete identification verification. Most firms presently do not have facilities for digital verification and will require sight of your original identification. (We arrange digital identification so your matter can be completed remotely).

3. If you have a mortgage, contact your lender to obtain their consent to the Transfer of Equity. Your solicitor will then satisfy any mortgage conditions imposed by your lender for their consent. If you are re-mortgaging or additional borrowing is sought, your solicitor will fulfil the lenders requirements. If there is no lender Step 3 is not applicable.

4. Your solicitor will draft the Transfer document or TR1 as it is referred to. If there is a lender, they will provide this to them to confirm their consent. The Transfer is also signed by any current owners, owners to be removed and parties to be added.

5. Once the signed Transfer is received, an application will be lodged at the Land Registry for the legal title to be amended.

6. Once submitted, it will be processed by Land Registry who will update their records and issue updated title documents.

7. Once updated, a letter will be posted to you confirming completion of the application and enclosing a copy of the new title deed reflecting ownership.

8. The file is closed and retained for six years at an off-site storage facility..

Please contact us if you require assistance with your Transfer of Equity. We are placed to arrange a Transfer within five days of receipt of your signed documents.