Equity is a legal term for the monetary value of the property that you own. When you have outstanding mortgage to pay, part of the equity belongs to the mortgage provider and the amount that you have already paid from the mortgage is your equity.
For example if you own a property that is valued at £250,000 and your outstanding mortgage is £150,000, you will have £100,000 of equity.
When a property undergoes a change of ownership, where at least one of the owners retains the legal title of the property, a transfer of equity mortgage process is necessary.
Transfer of equity commonly occurs after a divorce, when rather than selling the property, one party will choose to stay there and buy out the other. Other situations that may require a transfer of equity include marriage, when a transfer of property is made from one name into joint names; transfer of a share of the property into a family member’s name for tax purposes; or a change in the distribution of shares in the property.
Conveyancing Lawyer can carry out all the legal paperwork required for transfer of equity, including changing the names on the deeds, obtaining formal consent from mortgage lenders, and completing stamp duty and land tax forms.
For some simple cases such as adding additional names to the title of a property and when little or no money changes hands and there is no remortgage involved, it is possible for homeowners to carry out the transfer of equity themselves. However in most cases, especially if more than two parties are involved, the services of conveyancing services should be used to ensure that all necessary legal steps are taken.
Conveyancing solicitors will obtain the legal deeds from the land registry and prepare the transfer of equity deed for all parties to sign. Mortgage lenders will then be notified and asked for written consent of the property transfer. Tax and registration forms are then completed and filed. The whole process usually takes between 4 and 6 weeks when using conveyancing services of Pindoria Solicitors.