W DaviesLoading ...
Box Icon Transfer of Equity

Transfer of Equity

A transfer of equity means a change in the legal ownership of a property without necessarily the sale of the property itself. Such transfers may take place after a separation or divorce or family relationship breakdown. Sometimes transfers of equity are for other reasons, for example, in the event of the retirement and appointment of a new trustee (where a trust is involved), or it might be beneficial for tax planning.


A transfer of equity can be a fairly straightforward process, since the parties involved will usually have a prior knowledge of the property. There is normally no contract involved and no searches required against the property as there would be on a purchase transaction. However, each transaction needs to be looked at on an individual basis and it is most important that all matters and consequences of a transfer of equity are given proper consideration.


What is required in a Transfer of Equity?

All parties involved will need to agree the terms of the transfer and in what shares each individual will hold the property (i.e. what equity each person will hold). For example a couple could each hold a 50% interest in a property. The property may also need to be valued to establish a ‘current market value’ and the parties will need to agree whether there is a value to be assigned to the share in the property being transferred. The share held in the property by each individual will form part of their estate and they will need to consider whether it is appropriate to make a Will or change their Will following a transfer of equity.


If There Are No Mortgages Involved

If there are no mortgages involved and the terms are agreed, a Transfer will be prepared and signed by all parties and registered at the Land Registry. If the value of the transaction is greater than £40,000 then a Stamp Duty certificate will need to be completed and submitted to HM Revenue & Customs on your behalf.


If There is an Existing Mortgage

If there is a mortgage registered against the property, then the lenders consent may need to be obtained prior to the transfer, or in some cases, the mortgage may need to be paid off (redeemed). Where an existing mortgage will remain and the lender has consented to a new person being added to the title of the property, they will become equally liable for the mortgage and its repayment, along with the other joint owners.

If a party is being removed from the title, the lender will again need to consent to this. The outgoing owner must be released from their obligations under the mortgage. This will usually be done by insertion of a special clause in the transfer, which all parties to the transfer will sign including the lender. The lender will make financial checks to ensure that the remaining owner is financially capable of keeping up with the mortgage repayments.


Where a New Mortgage is Being Obtained

If a new mortgage is being obtained it will need to include the names of all the people who will be joint owners of the property following completion.


Stamp Duty Land Tax

If the value of the transaction is greater than the minimum threshold for paying stamp duty (currently £125,000) and no relief or exemptions apply, then stamp duty may be payable. If the value is under the threshold but greater than £40,000 then no stamp duty will be payable but a Return will still need to be submitted. The value is based on any amount paid by an incoming owner or to an outgoing owner, as well as any amount outstanding on an existing mortgage or borrowed on a new mortgage.

There are many exemptions and factors which affect stamp duty on transfers of equity and we are happy to help with any queries you may have.



Urban Myth: Making a Transfer to Avoid Creditors

Sometimes people consider completing a transfer of equity to prevent creditors from being able to claim some or all of the equity in a property, in the event they become bankrupt. For example, a husband involved in a business may consider transferring a property into his wife’s sole name in an attempt to avoid creditors, if the business is not going well. This is not a good idea. The Trustee in Bankruptcy has powers under legislation to set aside or reverse transfers carried out to avoid creditors, in anticipation of bankruptcy. Once a transfer is set aside by a Trustee in Bankruptcy the trustee will be entitled to the equity in the property on behalf of the Bankrupt’s creditors.



Declarations of Trust

Unmarried couples or friends buying a property together should consider what might happen if a relationship/friendship breaks down.

It is important to consider:

  • Who will make the mortgage payments?
  • Who will organise maintenance/insurance?
  • Who will actually live at the property?
  • If the property is an investment property, in what proportion will any rental income be divided?
  • In what proportions will any equity be divided, on a future sale?



Inheritance Tax (IHT) and Capital Gains Tax (CGT)

A transfer of equity in a property may have inheritance and capital gains tax implications. If you have any questions regarding this please contact us for further assistance.



Contact us to ask about our Transfer of Equity services

Select Personal or Business? *
Select Personal or Business? *

We use cookies to personalise content and ads, to provide social media features and to analyse our traffic. We also share information about your use of our site with our social media, advertising and analytics partners who may combine it with other information that you’ve provided to them or that they’ve collected from your use of their services. You consent to our cookies if you continue to use our website.

Privacy Policy | Cookie Policy

  • Overview
  • Essential [22]
  • Analytics [5]
  • Advertising [3]
  • Personalise [0]
  • Other [0]

Cookies are small text files that can be used by websites to make a user's experience more efficient. The law states that we can store cookies on your device if they are strictly essential for the operation of this site. For all other types of cookies we need your permission. This site uses different types of cookies. Some cookies are placed by third party services that appear on our pages.

You can at any time change or withdraw your consent from the Cookie Declaration on our website. Learn more about who we are, how you can contact us and how we process personal data in our Privacy Policy. Please state your consent ID and date when you contact us regarding your consent.

Essential cookies help make a website usable by enabling basic functions like page navigation and access to secure areas of the website. The website cannot function properly without these cookies.

Cookie Provider Info Duration
amplitude_id_dc1ea89f36525f97c2d3ca51c781bf54_mindbody_branded_webbwebsmart_co_ukUnknown24 Hours
mp_a36067b00a263cce0299cfd960e26ecf_mixpanelUnknown24 Hours
BIGipServerZebedeeUnknown24 Hours
_hjTLDTestUnknown24 Hours
_hjIncludedInPageviewSampleUnknown24 Hours
_hjAbsoluteSessionInProgressUnknown24 Hours
_dc_gtm_UA-74945071-1Unknown24 Hours
_gat_UA-74945071-1Unknown24 Hours
_hjFirstSeenUnknown24 Hours
_hjSessionUser_322703Unknown24 Hours
_hjSession_322703Unknown24 Hours
wp_langUnknown24 Hours
_hjIncludedInSessionSampleUnknown24 Hours
wordpress_sec_%WordPressThese cookies help us keep you logged in to our site.Session
wordpress_test_cookieWordPressSet by WordPress to check if the cookies are enabled on the browser to provide appropriate user experience to the usersSession
wordpress_logged_in_%WordPressWordPress sets this cookie to indicates when you’re logged in, and who you are, for most interface use.Session
wp-settings-%WordPressUsed to customize your view of admin interface, and possibly also the main site interface1 Year
wp-settings-time-%WordPressUsed to customize your view of admin interface, and possibly also the main site interface1 Year
bcookies_acceptanceb:cookiesUsed to store your cookie preferences for this site2 Years
bcookies_acceptance_updatedb:cookiesIndicates that the users cookie selection has been updatedSession
wp-saving-postWordPressUsed to help with the saving of content in the WP backend admin24 Hours
intercom-id-%IntercomAllows visitors to see any conversations they've had on Intercom websites.9 Months

Personalisation cookies enable a website to remember information that changes the way the website behaves or looks, like your preferred language or the region that you are in.

Cookie Provider Info Duration
We are not using cookies of this type at the moment!

These cookies gather anonymous information such as how many people are using our site or which pages are popular to help us improve customer experience. Switching off these cookies will mean we can’t gather information to improve the experience.

Cookie Provider Info Duration
_gaGoogle AnalyticsUsed to store a unique client identifier ID (randomly generated number) that is used to generate statistical data on how the visitor uses the website.2 Years
_gidGoogle AnalyticsUsed to store a unique client identifier ID (randomly generated number) that is used to generate statistical data on how the visitor uses the website.24 Hours
tk_tcJetpack/WooCommerceStore the user's usage history.Session
_gat_gtag_%Google AnalyticsUsed to set and get tracking data24 Hours
_hjidHotjarSet when the customer first lands on a page with the Hotjar script.24 Hours

Advertising cookies are used to track visitors across websites. The intention is to display ads that are relevant and engaging for the individual user and thereby more valuable for publishers and third party advertisers.

Cookie Provider Info Duration
__adal_caAdalyserUniquely identifies a user and persists long-lasting information about their behaviour on the site.2 Years
__adal_idAdalyserUniquely identifies a user and persists long-lasting information about their behaviour on the site.2 Years
_fbpFacebook24 Hours

Unclassified cookies are cookies that we are in the process of classifying, together with the providers of individual cookies.

Cookie Provider Info Duration
We are not using cookies of this type at the moment!