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Mortgages & Equity Release

Residential Property

Remortgaging means moving your mortgage to a new lender while staying in the same property. Our experienced team is able to swiftly assist with the paperwork required by your mortgage lender to allow for a smooth transition between products and the funds arriving in your account in a timely manner.

Homeowners are also increasingly turning to equity release to unlock money for example for their retirement.

Equity Release

There are two main types of equity release:

  • Lifetime mortgage. This is the most common type of equity release. You borrow money secured against your home. The mortgage is usually repaid from the sale of your home when you die or move permanently into residential care.
  • Home reversion plan. You raise money by selling all or part of your home while continuing to live in it until you die or move into permanent residential care.
Eligibility criteria for equity release

There are certain conditions you must meet before being able to take out equity release:

  • For a lifetime mortgage you (or both of you, if you’re borrowing jointly) need to be at least 55 years old.
  • For a home reversion plan you (or both of you, if you’re taking out a plan jointly) need to be at least 65 years old.
  • You must own property in the UK, which must be your main residence.
  • Your property must be in reasonable condition and over a certain value, and there may also be restrictions on the type of property accepted.
  • If you have a mortgage or secured loan on your property you may still qualify for equity release, but it will depend on the value of your home and the amount outstanding on the existing mortgage or loan. You'll have to pay off any outstanding mortgages or loans secured against your home at the same time as taking equity release.
  • Equity release may not be suitable if you have dependants living with you. Any dependants should take separate legal advice. If they wish to remain living with you in the property, they may need to sign a waiver confirming that they understand they don’t have the right to reside there if you die or move into permanent residential care.

Understanding the features and risks of equity release is complicated and you should seek legal advice before entering into any binding arrangements of this nature.

Transfer of Equity

A Transfer of Equity is a change in the co-ownership status of a property. You might arrange a transfer of equity to:

  • Add your spouse to your property's deed if you have married or remarried
  • Remove your ex-partner from the deed if you have divorced
  • Change the percentage shares owned by the co-owners of a jointly owned property or buy out a co-owner's share in the property
  • Reduce future inheritance tax liabilities or take advantage of personal capital gains limits.
What is equity?

Equity is the value of your property less the outstanding sum of your mortgage. For example, if you own a home costing £200,000 and you have a remaining mortgage of £80,000, you have £120,000 equity.

If you got married and want to co-own the property with your new spouse, you can only transfer half of the equity – worth £60,000 in this case – rather than half of the value of the overall property.

How do you transfer equity?

To start a Transfer of Equity you will first need an official copy of the title for the property. This will be used to check if there are mortgages on the property or any other restrictions that might be involved.

Your conveyancer will then:

  • Review the title deeds or property deeds
  • Check the identity of the clients
  • Prepare the transfer deed

The next steps depend on whether or not there are any mortgages on the property.

If there are no mortgages on the property, the existing and new owners of the property sign the transfer deed in the presence of a witness and the conveyancer registers the transfer deed at the Land Registry. A stamp duty certificate is needed if the value of the transaction is above £40,000.

If there is a mortgage on the property, you will also need the consent of the mortgage lender to go ahead with the transfer.

This is because if you are adding someone to the title, they will become equally liable for the mortgage.

Equally, if you are removing someone from the title, they will pass their liability on to the remaining owners of the property. The mortgage lender will want to check that remaining owners are able to maintain mortgage payments before agreeing to the transfer.

Your conveyancer will contact the mortgage lender and request written consent to the transfer. The mortgage lender may want to change the terms of the mortgage before consenting. Once written consent is received, the process can continue as above.

If the mortgage lender does not agree to the transfer, you will need to repay the mortgage before you can go ahead with the transfer. This can either be with a cash payment or a remortgage with a different lender who agrees to the transfer.

Our Residential Property solicitors are available at Ashford, Canterbury and Herne Bay. They are all experts in their field, dedicated to excellent client care, outstanding legal performance and to making the process as stress free as possible.

If you need help with a remortgage or equity release transaction, please contact a member of our team who will be happy to help.

Our Experts

Gemma Bath

Head of Department
Residential Property

Paul Boucher

Partner
Residential Property

Chris Dewhurst

Partner
Residential Property

Louise Farrow

Partner
Residential Property

Julie Smith

Chartered Legal Executive
Residential Property

Laura Foster

Licensed Conveyancer
Residential Property

Shehaam Van Twest

Licensed Conveyancer
Residential Property

Thomas Picknell

Trainee Solicitor
Residential Property

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