What is a transfer of equity?
Equity is the amount of your property that you own. To calculate this amount, you subtract the mortgage on your property from your property’s market value.
All joint owners of a property hold the legal title to the property as joint tenants. However, the beneficial interest in the property can be held in two different ways:
- As beneficial joint tenants. If one owner dies, then the other people named in the property title deeds will receive that person’s share. There is no need to apply for a grant of probate. The surviving owner or owners will need to send a copy of the death certificate to the Land Registry.
- As beneficial tenants in common. In this case, each owner has a separate share in the property. If one person dies, their share will go to whoever they have named in their Will.
A transfer of equity happens when someone is added or removed from the property title deeds, but at least one of the original owners stays on the deeds. The process does not necessarily involve any money changing hands.
When might you need to transfer equity?
You might need a transfer of equity if you:
- Have married or entered into a civil partnership and wish to add your partner’s name to the house deeds.
- Are divorcing or separating and wish to remove somebody’s name from the deeds.
- Co-own a property and would like to change the percentage shares everybody owns.
- Wish to transfer a share of your property to a family member.