Transfer of equity only?

CaroleFS

Hi all - I have a buy-to-let property in my sole name and have been advised it would be better tax wise to have the property in both my and my husbands names (for if we decide to sell in the future). I've contacted the mortgage company who have sent a change of ownership/transfer of equity application and the paperwork reads like the current mortgage will continue as it is with both our names on it (if my husband is accepted). I have been enquiring for costings with solicitors to see if this will be of any advantage (when we sell) and have had quotes from £1400 to £400.
NOW..the most recent conveyancing solicitor told me that it is not possible to transfer equity without a remortgage (charging more for this purpose) so my question is - does adding a name to a mortgage and deeds mean you are remortgaging or is it possible to just transfer equity?
Sorry if this sounds a bit daft but have just had a very bamboozling and long conversation with the lower priced solicitor who insists it's a remortgage and wanted to get your views before ringing the non-free mortgage company's line. Thanks.

amnblog

The persons named as owning the property need to be named on the mortgage.


When did you get the advice to change the property to joint ownership?

CaroleFS

A financial advisor friend advised us recently as being possibly useful for tax relief when we come to sell it in the future. At the moment i am named on the mortgage and the mortgage company are saying we need to apply for a change of ownership (transfer of equity) into both our names.
We are not desperate to do this if it isn't going to be any advantage - especially since the cost of transfer is relatively high.
What do you think?

TrickyDicky101

There could be income tax advantages to holding in both names (if your marginal rate is higher than your husband's).

What is the value of the mortgage on the property? Over £250k and there will be SDLT to pay on any ToE.

What's the value of the property and what was it when you purchased it (or when you first let it if you previously lived in it as a residential property)?

Have you ever lived in it? Lettings relief may come in to play then on any subsequent disposal.

amnblog

CaroleFS wrote: »

What do you think?

I think contacting the Lender off of the back of a conversation that suggests a transfer of equity could be possibly useful is a little premature.


Take advice from a Qualified Accountant before you take such an action.

CaroleFS

Thanks for responses so far but i think i've steered everyone off course - don't want to waste anyones time. I'll contact the mortgage provider to see if they can answer my query.

TrickyDicky101

Yes, you would get to use both of your annual CGT allowances if held in both names when you come to sell.

So from that point of view it would be advantageous.

Unless you plan to imminently sell, consideration of both your and your husband's marginal rates for income tax is probably more pertinent.