Transfer of Equity - New mortgage with partner

navidson

My partner has recently sold her house and moved in with me.  I am in the process of applying for a new mortgage and would like to add her to the mortgage.  I started the application process with First Direct and was informed that I would need to add her to the deeds - which would mean i had to go through the 'transfer of equity' process.

Could anyone please advise the best way of going about this?  Should it be possible to apply for a new joint mortgage and have the transfer done at the same time by the lender?  Do I need to sort out the equity transfer before I apply for a new mortgage?  

Any help would be much appreciated as always!

Exodi

No the lender isn't going to do a transfer of equity for you. You need a conveyancing solicitor.

But before that you first need to work out what you both want to happen, as surely you didn't plan to make her liable for the mortgage, but simultaneously keep the house and any future equity in your sole name?

It may be that you want a model that increases her contribution in line with the mortgage payments she makes, or perhaps she's putting in a massive contribution that she wants to protect, in which case you may want to consider owning the house as tenants in common with a deed of trust in place - again all stuff a conveyancing solicitor can discuss with you.

kingstreet

The TOE and the remortgage application can run concurrently with the lender handling the former and a solicitor the latter. As Exodi has suggested unequal equity etc can be handled by the solicitor during the process with a deed of trust. Check SDLT liability as well, before you commit yourself.

navidson

Thanks for the useful advice - The idea is for us both to jointly own the house and have a joint mortgage - There will be no unequal split of equity

Exodi

navidson said:

Thanks for the useful advice - The idea is for us both to jointly own the house and have a joint mortgage - There will be no unequal split of equity

Well then you can either do the transfer of equity (TR1) as joint tenants yourself (which I do not advise, based on what you've said) or appoint a conveyancing solicitor to do it for you.

kingstreet

A solicitor will have to handle the remortgage, so getting the TOE done at the same time makes sense. It usually adds about £250 to the usual remortgage cost so you might want to choose a 'cashback for legals' option rather than a 'free legals' conveyancing warehouse whose service is often not great.

gwynlas

If you are not entering marriage or legal partnership then you should have a Deed of Trust drawn up to protect any equity either of you are transferring into property. You also need to decide what would happen should you split up. become critically ill or die.