Do I need a solicitor to add a spouse to property deeds?
Adding a partner to the deeds of a property whilst still retaining a share yourself is known as a ‘transfer of equity’. Many people choose to share the ownership of their home after getting married or entering into a civil partnership.
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A transfer of equity can be a relatively simple process, which does not necessarily require legal help. However, some cases can be much more complex, so many people feel it is more beneficial to engage a conveyancing solicitor, as they will be able to discuss options for joint ownership with you as well as completing all of the land registry paperwork. Sometimes mortgage lenders may insist that a transfer of equity is carried out by a solicitor.
If you want to add your partner to your property deeds, you will need to think about what type of joint ownership is best for you, as well as considering the implications for your mortgage.
Which type of joint ownership is right for you?
In England and Wales, couples can be either Joint Tenants of a property or Tenants in Common.
Joint tenants each hold an equal share of 50% of the property, and when one person dies, then the sole property ownership automatically goes to the other partner under the Right of Survivorship. As a joint tenant, you cannot pass on your half of the property to anyone else but your partner when you die.
Tenants in common
Tenants in common, however, can own different percentage shares in the property (though can also hold a 50% share each), which may depend on the financial contribution each person has made. This is the 'beneficial interest' each person has in the property.
In this scenario, if one partner dies, their share of the property does not automatically go to the other co-owner but is passed on in line with the terms of their will, for example, passing it on to their children.
A conveyancing solicitor will be able to help you find the right joint tenancy options for you and your partner.
How to add someone to your property deeds
To add a name to your property deeds, your conveyancing solicitor will need to obtain a copy of the property title through the Land Registry. Once obtained, they will prepare a Transfer Deed which must then be signed by all joint owners and in the presence of a witness.
Contacting your mortgage lender
If you have an outstanding mortgage on your property then you will need consent from your lender before you can add someone else to the property deeds, as the new owner will become equally liable for the mortgage repayments once the transfer takes place. In this case, your conveyancing solicitor will be able to help you complete the remortgage in joint names as well as the transfer of equity, and they will need to comply with any requirements set out by the lender as part of the transfer.
It is important to note that there are other financial considerations which need to be made when adding a partner to your property deeds. The partner taking on the equity in the property may have to pay Stamp Duty Land Tax (SDLT) or capital gains tax on the transaction. If you’re taking on equity and a mortgage to a value of more than £125,000, then you’ll be required to pay stamp duty and tax on any equity over this threshold.
Leasehold or freehold?
If your property is a leasehold, then you may need to obtain written consent from your freeholder or managing agent before the transfer of equity can be carried out, and the new owner may be required to execute a Deed of Covenant, which will incur an additional fee.
Again, your conveyancing solicitor will be able to advise you if a Deed of Covenant is necessary when they review the title to the property.
Most people find that engaging a conveyancing solicitor makes the process of transferring equity simpler and more straightforward. A solicitor will be able to advise about tenancy options, compile the correct documentation and communicate with the lender. With the assistance of a solicitor, the process of adding a name to the property deeds should usually take around four to six weeks.