An increasing number of people are now choosing to remortgage their properties rather than moving home. We can advise you of the best solution for you and your home.
Remortgaging is the process whereby you decide to repay your existing mortgage and take out a replacement mortgage with a different lender or mortgage company. Usually the new mortgage will be for a larger amount so that you can have extra money available, although it is also popular to remortgage to get more favourable interest rates from the new lender.
When you instruct us on a remortgage we will ask you to complete a client questionnaire that will give us more details about your property and your circumstances. In particular, we will need details of your current mortgage in order that we can obtain your Title Deeds. Since you already live in the property, hopefully you will have all the information we will need. If you have extended or altered the property we will need copies of any Planning Consents and Approvals that relate to these works.
When we receive the Deeds we will check them on behalf of your new lender. The names of the owners on the Deeds must be the same as the names on the new mortgage so you must tell us if the names have changed (for example if the property was bought in a wife’s maiden name) or if an additional person is being added to the deeds.
Many lenders will require us to carry out searches against your property. This can be frustrating since you already live in the property but unfortunately this will probably be the first time your lender has dealt with your home. We will check with the new lender and where possible will avoid unnecessary searches.
The new lender will send you and us a written Mortgage Offer which you should check carefully as you will have to comply with any conditions imposed by the lender. You may need to give us a copy of your existing buildings insurance policy so please check this is available. This may need to be amended so that it includes details of your new lender.
You will need to sign the new Mortgage Deed. Some lenders may require you to do this in front of a lawyer and we would be happy to see you to deal with this. We will need to see copies of your passports as proof of your identity.
When the new Offer has been made in writing and any necessary search results received, we will agree with you a completion date which is when we will repay your existing mortgage and obtain the new mortgage.
We will provide you with a financial statement. If the amount you are borrowing on the new loan is less than the amount owing on the existing loan plus costs and search fees, you will need to give us the balance before completion.
If you have borrowed sufficient on the new loan to cover the cost of repaying the existing loan and any search and legal fees, (as is more usual), we will pay off your old mortgage and pay you any surplus on the completion date.
We will then arrange for the Land Registry to amend your Title Deeds to reflect any change in ownership details (if you have married, for example) and to remove the old mortgage details and replace them with details of your new lender.
When land or property is owned jointly by two or more people, circumstances may sometimes dictate that one of the owners must transfer their share to the one of the other joint owners which is known as an equity transfer.
The equity in a property, owned by any individual, is the net value of their share and is calculated after deduction of any outstanding loans or mortgages that are legally secured on the property.
A transfer of equity may be required for various reasons however the most common reason is when a couple decides to divorce or separate. When this happens, the normal course of action is for the couple to make an agreement for one to buy the other out for a fixed sum however where agreement cannot be reached it may be necessary for the property to be placed on the open market for sale with the net proceeds of sale being divided between the parties either in accordance with their agreement or if no agreement can be reached in accordance with a court order. In these cases it is essential that the conveyancing services are carried out using separate solicitors acting on behalf of the transferor and transferee to ensure that the parties are treated fairly and to avoid possible conflicts of interest.
A transfer of equity usually involves the passing of money however there are many cases where property transfer is effected as a gift, for example when a parent wishes to make a gift to their adult children by adding their child(s) name to the property. Note that the transfer must be to an adult child otherwise the property has to be held in trust if the child is a minor.
As part of a transfer of equity, any existing mortgagor(s) must be informed of the process and in many cases the transferee will request that the mortgage continues in their sole name after the transfer is completed. Unless the transferee can show proof of ability to pay off the mortgage, some lenders may not agree to continue funding the loan unless both parties continue to be financially responsible for the ongoing loan. Provided that the new sole owner can show ability to service the loan then the previous owner may be released from the mortgage.
When you instruct us on a transfer of equity we will ask you to complete a client questionnaire that will give us more details about your property and your circumstances. In particular, we will need details of your current mortgage in order that we can obtain your Title Deeds and liaise with them in effecting the transfer. Since you already live in the property, hopefully you will have all the information we will need.
Are you looking to reassess your mortgage? Home 2 Home Property Lawyers can help you, call
020 8933 9663