Transfer of Equity Solicitors Liverpool & London
A transfer of equity changes the way your property is owned without a sale, as such, needing to be involved.
Transfer of Equity
A transfer of equity occurs where the legal ownership of a property changes hands. An example would be where joint owners transfer the property into the sole name of one or other of them, or where a sole owner adds another owner into the title.
In most cases a transfer of equity will be more straightforward than a sale or purchase since in most cases searches or enquiries will not be needed because the parties to the transaction already have knowledge of the property. There is also usually no need for a contract. The main complication tends to be where the property is subject to a mortgage since the consent of the lender will need to be obtained before the transfer can take place.
Why might a transfer be needed?
- One of the most common reasons why a transfer of equity may be needed is in relation to a new relationship or marriage. Here someone who was a sole owner of the property may wish to transfer a share of that property to his or her new partner or spouse. If the property is subject to a mortgage then the consent of the mortgagee will need to be obtained.
- Another common reason for a transfer of equity is where a relationship has broken down and the property is being transferred from joint names into the sole name of one of the parties to the relationship following a separation or divorce. This may be as part of a court order to deal with the distribution of assets on divorce. Again, the consent of the mortgagee will normally be required and it may be necessary for the remaining party to be able to show that they are able to manage the mortgage payments on their own.
- The third most common reason for a transfer of equity is for tax planning purposes. Ownership of property may need to be transferred into the name of a third party (for example family member) to help reduce tax liabilities or to help ensure that the property remains in the family.
- The tax position, especially in relation to the latter reason for transfer, must be taken into account and we will be able to advise you upon this.
Contact our Residential Conveyancing Solicitors Liverpool & London
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