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propertylawyer
propertylawyer, Solicitor
Category: Law
Satisfied Customers: 280
Experience:  Property Solicitor with expertise in commercial and residential property transactions.
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I need to remortgage my property to release equity house

Resolved Question:

Hi,
I need to remortgage my property to release equity for another house purchase and to switch from an interest only mortgage to a let to buy mortgage. My name is ***** ***** house deeds. My husband's name is not (we married after I bought it). We have been told by our mortgage broker that to get the remortgage my husband's name needs to be on the deeds (because he earns more than me).
If we remortgage the property in joint names will there be any stamp duty to pay and if so can this be negated by a deed of trust (declaration of trust)?
Many thanks!
Vivien
Submitted: 1 year ago.
Category: Law
Expert:  propertylawyer replied 1 year ago.

Hi Vivien

Thanks for your question.

Can I check I have understood correctly that on the house you own now you want to remortgage it with a buy to let?

If this is the case why does your husband need to be on the deeds/mortgage? A buy to let is calculated by the potential rental income. If his name must go on the deeds then you will need to do a nil consideration transfer from you to you and your husband - there is no Sdlt on such a transfer.

I can chat this through with you on the phone if you wish?

Regards

Customer: replied 1 year ago.
Thanks, I'm happy to chat online for now.
That's right, we currently live in my flat with an interest only mortgage. We want to remortgage it as a buy to let to rent it out and release equity, so we can buy another property to live in (with another mortgage).
Our mortgage broker (a friend of my husband's) has advised that because my income is low (around £10,000) we would be restricted to lenders who have no minimum income requirement. If my husband goes on the deeds we can apparently get a better deal as his income is much more than mine.
Many thanks!
Expert:  propertylawyer replied 1 year ago.

Hi Vivien

If it is necessary to do it to get a mortgage then it is possible you do it.

As mentioned above the transfer would be from you to you and husband. This is done on standard land registry form TR1. You can both own as joint tenants or tenants in common. There is a distinction between the two. As you bought the flat and all the equity in it is yours you may want to protect that. Joint tenants own the whole jointly. Tenants in common own separate distinct shares. This can be 50/50 or some other proportion. You need to state this on the TR1. If you go for tenants in common in unequal shares you will need to enter into a declaration of trust to record this.

The transfer can be for a nominal amount.

Your husband's name needs to be on the title if it is to be on the mortgage.

A solicitor can do the transfer/declaration of trust.

Do note that your subsequent purchase will be subject to the additional 3% Sdlt surcharge as it will be a second home. This rule came in April this year. You can find a Sdlt calculator online to work out the Sdlt with the surcharge on the price of your intended purchase.

I hope this helps.

Do let me know if you have any further queries.

If not please can I ask you to leave a positive rating so that I receive credit for helping you.

Kind regards

P

Customer: replied 1 year ago.
Thanks, that's all helpful!(I am aware of the SDLT surcharge on the second property, but we feel it's still worth doing)Can I just ask you to clarify what you mean by 'the transfer can be for a nominal amount'?Many thanks again!
Expert:  propertylawyer replied 1 year ago.

Nominal means £0 or £1 or other small amount.

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