You can also transfer the equity to an existing couple if you are separating or divorcing. The backbone of the process is the Property Registry Form TR1, which will need to be completed. Describes who are the current owners, the “sellers”, and who will be the new owners, the “assignees”. You will also need to carry official copies of the title with you, along with complete contractual information about any mortgages.
If there is no mortgage, things are pretty simple. All parties need only sign the transfer deed (form TR1) and file it with the land registry. This must be accompanied by the Property Registry Form AP1, and if the transaction value amounts to more than £40,000, a stamp duty land tax certificate may also be required. Your transfer agent will deliver the mortgage deed for you to sign and then facilitate the transfer of funds between the parties.
The outgoing parties must complete and sign a form ID1, in the presence of their transport agent. First of all, you will have your transfer fees, which will be calculated based on many factors, such as the value of your property or whether you need to re-mortgage or not. In most cases, rates will range from £100 to £500+VAT. But the biggest cost involved is usually the transfer of capital from the stamp duty land tax.
When a party contracts capital or a mortgage for a total value of more than £125,000, land tax may have to be paid with stamp duty. Accurate amount due is calculated using bands. If one of the parties leaves the title to the property due to a divorce, no stamp duty land tax will be due. In a situation where there is a mortgage that will remain in effect after the transfer, you will first need the consent of the lender.
The transfer of capital as part of a gift, divorce agreement or equal spilt property is exempt from stamp duty. In most cases, this will involve re-mortgaging with the existing lender or transferring the mortgage to a new provider. Career guidance will always make a transfer of capital go smoothly and will eliminate any stress for you. If you also plan to re-mortgage as part of the transfer process, the legal work of re-mortgaging can be completed at the same time as your capital transfer.
As the ownership structure will change when capital is transferred, the lender will have to carry out similar controls on new owners. Before completing the transfer, the legal professional in charge of the transfer of capital shall request and review the existing title deeds, verify the identity of the transferor and the transferee (this is essential before the transfer can proceed), and then draft the transfer deed. If you want to give away a property, you will have to pay the mortgage before the capital transfer is complete. If you are re-mortgaging at the same time as the capital transfer, you don't need to tell your current lender, as the existing mortgage will be repaid before the transfer is complete.
The transfer of capital can be complex as it involves land registration applications and land tax forms. Transferring the capital of a property without an existing mortgage is usually straightforward and can be completed in 3 to 4 weeks. In fact, a transfer of capital is required for any change of ownership in which at least one of the original owners remains in the title. If you are transferring your capital to an existing co-owner or a new third party, you will transfer your liability under the terms of the mortgage to the rest of the property owners.
Transmitting lawyers routinely handle the legal work for the remortgage at the same time as the transfer of capital. .
