A step-by-step DIY guide to transferring equity in a property
A transfer of equity is when you transfer all or part of your ownership of a property. In the context of property, equity means the value of your interest in a property.
Transferring equity in a property can be a straightforward legal process which, in some circumstances, can be completed without needing to instruct a conveyancing solicitor.
This guide is for anyone thinking of completing the transfer of equity process themselves, or for anyone seeking a more detailed understanding of what is involved.
A 'transfer of equity' is when an existing owner of a property adds or removes one or more people to the title (ownership) of the property.
You might, for example, decide to transfer equity if you:
- Sell your share in a property
- Buy out an ex-partner after a separation
- Buy out a joint owner
- Adding a new spouse, civil partner or unmarried partner to the deeds of your home
- Gift a property (or share in a property) to a child, spouse, civil partner or other family member
There are two types of property transfer
Full transfer of ownership
If you are gifting the property in its entirety to another person (e.g. a child or family member), you would be transferring full ownership of the property.
Part transfer of ownership
If, for example, you are the sole owner of a property, and you want to transfer a share (e.g. 50%) in the property to your partner, spouse, child or someone else, you would be transferring part ownership of the property.
The basic property transfer process is the same in most cases, whether you are transferring full or part ownership.
What is the legal process for transferring ownership in a property?
Transferring equity in a property is a legal process. This process is normally completed by a conveyancing solicitor and is usually a quick and inexpensive process.
The process can get complicated - especially if there is a mortgage or if the property is leasehold. If there is an existing mortgage which will not be paid off at the point of transfer, the lender will require you to instruct a conveyancing solicitor to complete the transfer.
If there is not a mortgage, you could complete the transfer process yourself. However, it is critical that the transfer and registration process is completed correctly, as any errors could have legal and tax implications.
Using a conveyancing solicitor will ensure that no technical or legal mistakes are made.
The process for completing a transfer of equity is as follows:
1. Complete a Change the Register (AP1) form
This standard form is used to notify HM Land Registry (HMLR) of the change of ownership in the property:
2. Complete the correct transfer form (TR1 or TP1)
If you are transferring full ownership of the property, you need to download and complete the:
If you are transferring part ownership of the property, you need to download and complete the:
3. Complete a Certificate of Identity Form (ID1) form
You will need to prove who you are to HM Land Registry. To verify your identity, you will need to download and complete the:
4. Calculate the HM Land Registry fee
The fee payable to HM Land Registry will depend on the type of application. To calculate the correct fee see: HMLR Fee Calculator.
5. Send the completed forms to HM Land Registry
Your solicitor will send the completed forms and the correct fee to:
HM Land Registry Citizen Centre
PO Box 74
Common transfer of equity FAQ's
How do I add my spouse or partner to my property deeds?
To make your spouse or partner a joint owner of the property, you will need to add them to the legal title. You will need to decide how the property is to be shared (e.g. a 50/50) between you, and complete the various documentation and HM Land Registry forms.
How do I gift my property to a child or family member?
The most common reason for people transferring ownership of a property to a family member is to minimise or negate Inheritance Tax (IHT). If the full ownership of the property is being transferred and no money is changing hands, this is referred to as gifting the property.
IHT is not usually payable if the deceased previous owner (e.g. the parent) lives for 7 years after the property is transferred. If the previous owner dies before the 7-year time limit, tax may be due.
If you are transferring a property as a gift, you can follow the procedure above and complete the TR1 form.
How do I remove someone from the property deeds?
You may decide to remove someone from the title of the property following a divorce or separation, or where friends or family have bought a property together and someone wishes to be released from ownership.
In this example, the outgoing owner may decide to transfer their equity to the remaining owner.
The transfer process would be carried out as described above.
For more information:
How do I transfer equity in the property after a joint owner has died?
In most cases where two people jointly own a property, the surviving owner will become the sole owner of a property when the other owner dies. The transfer of equity process will need to be completed.
The surviving owner will need to complete a Deceased Joint Proprietor (DJP) Form to notify HM Land Registry (HMLR) that one of the joint owners of a property has died.
This form can only be used when there is at least one surviving owner of the property. The DJP form will remove the name of the deceased person from the property's registered title.
You will also need to send an official copy of the death certificate when you send in this form to HMLR.
How do I transfer equity if there is a mortgage on the property?
It is usually possible to transfer ownership of a property with a mortgage, however, the process is more complex and can take longer to complete.
If there is an existing mortgage which will not be paid off at the point of transfer, you will need to obtain the lender's consent for the transfer. Essentially, this is a remortgage, so the lender will need to ensure that the incoming joint owner meets their lending criteria.
The lender will require you to instruct a conveyancing solicitor to complete the transfer.
To ensure their interests are protected, the mortgage lender will also need legal representation. In most cases your conveyancing solicitor will also be able to act for the lender.
You should check that your solicitor is on the lender's panel of approved solicitors at the start of the process.
When you get a Quittance transfer of equity quote, you can include the legal work for the remortgage as part of the quote.
Can I transfer equity without a solicitor?
Yes. However, even if no money is changing hands, transferring property can be a complex process.
Whatever the circumstances of the transfer, there may also be Stamp Duty Land Tax (SDLT), Capital Gains Tax (CGT) and Inheritance Tax (IHT) implications.
Instructing a conveyancing solicitor to carry out the conveyancing process ensures that you are legally protected and ensures that the legal transfer is completed correctly. Transfer of equity conveyancing is inexpensive and prevents costly potential errors.
How we can help you
Whether you are gifting a property to a child, getting married or separating, or transferring equity for any other reason, our solicitor panel can help make the process as straightforward and stress-free as possible.
If you are also planning to remortgage as part of the transfer process, the remortgage legal work can be completed at the same time as your transfer of equity.
- Transfer of equity experts
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Gaynor Haliday, Legal researcher
About the author
Gaynor Haliday is an experienced legal researcher and published author. She has had numerous articles published in the press and is a legal industry commentator.