Transfer of Equity - what does it mean?

FatmanDaz

Here's my situation:

Divorced, with my ex living in the family home along with our daughters. We had an amicable split, documenting our finances with a Consent Order. Part of which is a 34 / 66 % equity split in my ex's favour.
The current mortgage on the house was a 2yr fixed term which ends at the end of October.
Approximate value of the house is £200k, with an outstanding mortgage amount of £97k.
Our plan was that at the end of this fixed term, my ex would look to remortgage in her own name, to allow me to seek a mortgage (if required) on another property. I am now re-married and although not urgent do want to have this issue sorted in the not too distant future.

So, the ex has stared exploring remortgages, starting with Santander as the current mortgage provider. Whilst they will not give her enough of a mortgage (only £50K), they also said that a transfer of equity would be required. Other lenders seem willing to give the mortgage amount required but also need the "transfer of equity".

It sounds like giving up my 34% of any equity from the eventual sale of the house, which I cannot afford to do. Is it this simple?
If it is then we have talked about selling the house ASAP, to release the equity, then my ex would buy another property albeit smaller. This isn't ideal as we did not want to disrupt our childrens lifes but realise we may have to.

Sorry for the long winded explanation but my simple question is , what does this transfer of equity document really do and mean to myself in particular, in regard to my share of potential equity in the family home?

Thanks,

If

TrickyDicky

The idea would be that your wife takes out a mortgage of 97k for the current mortgage, plus 35k to cover your share of the equity. Otherwise the only other option for you to get the money is sell the house.

kingstreet

The transfer of equity is the removal of, or addition of, a party to or from the ownership of a property.

If your former wife remortgages, she will have a single mortgage and a joint property so the transfer of equity would remove you from the deeds to match the new mortgage.

If she cannot raise the necessary mortgage to take over the current borrowing, she'll be unable to do the transfer of equity now and the issue of your share is moot as nothing will happen.

In a perfect world, as TD says, she'd use the remortgage to raise enough money to buy you out and repay the current mortgage and the TofE would leave everything in her sole name.

oz1

Hi it will be worth your ex wife trying other lenders, I found Nationwide to be the best as they took a lot more into consideration than other lenders.

FatmanDaz

She is looking at other lenders & at least one looks promising.
Regarding the equity I don't want mine now, in fact we always intended to leave the sale as long as we could to make the most money. I guess what I'm trying to understand is that in removing myself from the mortgage & deeds do I lose my equity option even though we have it detailed in our consent order.
Would the transfer of equity overrule the consent order?
Thanks,

kingstreet

FatmanDaz wrote: »

Would the transfer of equity overrule the consent order? Thanks,

I would not think so, but I'd recommend getting an opinion from a solicitor before you sign the transfer form. When her solicitor sends it to you it will recommend you take independent legal advice.