When might you need to transfer equity in your home?

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Change in Relationship Status

A common reason for a transfer of equity is the desire to include a spouse or partner as a co-owner after marriage or when entering into a civil partnership. This helps formalise joint ownership. During a divorce or separation, individuals may opt for a transfer of equity to address joint ownership issues, transferring the property to one party.

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Sharing Ownership

People might transfer equity as part of planning to pass on property as part of an inheritance. Sharing property through equity transfers can be a way to give a portion to family members.

Cohabitation

Individuals moving in together may adjust property ownership to reflect changes in financial contributions or living commitments.

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Considerations

A transfer of equity is usually a quick and straightforward process, but certain situations can make it more complex. If there’s a mortgage, a divorce, or if one person is buying out the other, it might take longer. In such cases, it’s important to seek advice from a reputable transfer of equity solicitor such as www.parachutelaw.co.uk/transfer-of-equity-solicitor before completing the property transfer.

When transferring equity to family members or others, like children or siblings, there are additional considerations. Your solicitor should help you navigate Stamp Duty and Capital Gains Tax implications.

If there’s a mortgage on the property, getting consent from the lender is a must before changing names on the deeds. Adding a new owner, especially when going from one person to two, requires lender consent. The new owner may undergo financial assessments similar to a new mortgage application. The lender wants assurance that the new owner can meet financial obligations and has no adverse credit history. If these criteria aren’t met, a mortgage lender may refuse to add a second person to the title.