Options about title

newleaseholder

hi there - just looking for some advice about options on what to do. My partner and I have split up a while ago, all very amicable but we now want to sort out our properties a bit more formally.

They will keep a flat which is mortgaged and solely in my name. Their place of residence.
I will keep a house which is mortgaged and in both our names.

We're both financially sound, good credit, etc so should be able to get mortgages. What would normally be the route to do that? 

canaldumidi

Married? Kids?

Assuming not, and assuming you have weighed up/agreed the equity in each of theproperties and the fairness of dividing them as you describe, then the practicalities are:

* the flat's current mortgage will need to be paid off. Either by cash/savings (from one or other of you depending the financial split you've agreed) or by partner taking out a new mortgage in their sole name.

* the joint mortgage will almost certainly need to be paid off (as described above). There is a (remote) chance the current lender will agree to remove your partner's name from the existing mortgage and also agree for the Title to be trasferred into your sole name. But more likely you'llneed to apply for a new sole mortgage

newleaseholder

Not married or kids.
So essentially both of us will have to take out a new mortgage to cover the balance? Does it mean we will go through some sale process and having to declare a profit?

canaldumidi

newleaseholder said:

Not married or kids.
So essentially both of us will have to take out a new mortgage to cover the balance? Does it mean we will go through some sale process and having to declare a profit?

If one/both have enogh cash to pay off existing mortgage, you won't need new mortgage. But somehow th existing mortgages need paying off!

When you say "They will keep a flat which is mortgaged and solely in my name. Their place of residence." do you mean it is currently their place of residence (main residence)? Or it will become their main residence?

If the latter, is it now empty? Let out? What? If you transfer it it into partner's name

* you could pay off the mortgage, then DIY transfer the Title to partner. But if partner is getting a mortgage they might as well use the mortgage lender's solicitor to also do the transfer.

* if the property is not currently your main residence, then when you sell/transfer to partner, you'll be liabel to Capital Gains Tax on the increase in value between when you bought and when you transfer. Unless it was previously your main residence in which case there are allowances and you need to do maths.

I assume the house is both your main residence? Therefore when transferred from joint to sole name there is no CGT, but same applies as above regarding DIY Vs solicitor for the transfer.

SDLT_Geek

newleaseholder said:

hi there - just looking for some advice about options on what to do. My partner and I have split up a while ago, all very amicable but we now want to sort out our properties a bit more formally.

They will keep a flat which is mortgaged and solely in my name. Their place of residence.
I will keep a house which is mortgaged and in both our names.

We're both financially sound, good credit, etc so should be able to get mortgages. What would normally be the route to do that? 

Don’t forget the stamp duty.  It would be stamp duty land tax if the properties are in England.  This looks like an exchange of property interests.