Transfer of Equity Costs 2023
Transfer of equity is a change in the co-ownership status of a property. This is done by adding or removing a person from the deeds of the property. The result is that the ownership of the property has been altered from a legal perspective.
It’s important to note that property transfers are different from property sales. Transfer of property ownership is different from the sale of property as at least one of the original owners of the property will stay the same. However, it is still important to note that it is a legal process that should be carried out by an appropriately qualified solicitor.
In this guide, we’ll be taking you through everything you need to know about the transfer of equity costs. We’ll also discuss the process involved. This will allow you to proceed with your transfer of equity with confidence.
Here are the transfer of equity costs, based on the average UK house price of £277,000:
|Anti-money laundering checks||£5|
|Bank transfer fee||£40|
|Land registry fees||£438|
|Freeholder consent||Up to £250|
|Remortgage||£175 plus 1-5% of property value|
|Total||£5,298 plus 1-5% of the property value|
Costs taken from our Average Conveyancing Fees data
Do Solicitors Charge More for Transfer of Equity?
Solicitors charge more for transfer of equity due to the amount of paperwork involved. It can be highly complex, so hiring conveyancing solicitors for transfer of equity procedures is essential. Your solicitor will provide you with legal advice throughout the process. They will also ensure that the transfer deed and title deeds are correctly transferred with minimal delay.
The cost can also be impacted by the value of the property. The more expensive the property is, the higher the solicitor’s fees will be.
How Much Does Transfer of Equity Cost?
Knowing the various transfer of equity costs will allow you to understand the process and what to expect. The total costs are dependent on multiple factors such as property value and the reason for transferring equity. Here are the costs you should know about:
Solicitor fee - £540
The transfer of equity fee is applied on top of your solicitor’s legal fees. This covers the extra paperwork and time involved. For example, the TR1 Form is one of the many documents your solicitor will need to fill out and submit on your behalf. The fee is determined by the property value and complexity of the case.
Anti-Money Laundering Checks - £5
Anti-money laundering checks are also known as identity checks. They seek to verify the funds and ensure the money is legitimate. When transferring equity, your solicitor will most likely conduct an anti-money laundering check.
Read more about Money Laundering Checks When Buying a House
Bank Transfer Fee - £40
The bank transfer fee may also be referred to as the CHAPS fee for money transfers. In any case where a money transfer of over £60,000 occurs, there will be a fee.
Land Registry - £438
The new owner of the property will need to be registered with Land Registry, regardless of the scenario. While the cost can vary, depending on whether you apply online or by post, the average land registry fee is around £438.
Freeholder consent - up to £250
Freeholder consent is a charge applicable to those transferring equity in leasehold properties. The amount differs depending on the freeholder. This charge provides the freeholder’s permission for equity to be transferred.
Stamp Duty - £3,580
Whether you need to pay stamp duty on a transfer of equity depends upon the ‘consideration' and the nature of the transfer of equity. Consideration includes both the equity being transferred and the value of the mortgage debt. In most cases, Stamp Duty Land Tax (SDLT) is likely to be the largest cost payable.
If you’re adding a new partner or spouse to the property deeds and the transaction is more than £60,000, stamp duty is payable. This is also the case if you are applying to transfer the property into joint names.
But if the transfer is a gift (i.e. from a parent to a child), or the property is split equally between two people, stamp duty isn’t payable. If a couple is divorcing or dividing property in accordance with a court order, there won’t be any stamp duty to pay.
Stamp Duty may also be avoided if both parties come to a private agreement.
Use our Stamp Duty Calculator to find out how much you have to pay
Remortgaging - £175 plus 1-5% of property value
If you have an existing mortgage on the property, there may be extra fees. For example, if you plan to remortgage your property during the transfer of equity process, your mortgage lender may implement a fee.
Use our Conveyancing Fees Calculator for an estimated cost
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Who Pays For It?
In most cases, both parties will cover their own respective costs when it comes to transferring equity. However, there are some instances where this isn’t the case. The main example is if the property is gifted to a child. In these scenarios, the transferor will usually pay all fees.
It’s best to ask your conveyancer for a full breakdown of the quote at the start of the proceedings. This ensures that you know what to expect and what you will have to pay.
Finding a Conveyancer
Compare My Move has a partner network of licensed conveyancers who are able to assist you with your transfer of equity. Fill out the comparison form and we will connect you with up to 6 licensed conveyancers. You can compare quotes and save money on your conveyancing fees.