Transferring ownership of a house with mortgage


Transferring ownership of a house with mortgage

Transferring the ownership of a home that has a mortgage, such as when gifting to the next generation, or giving someone shared ownership of a property with a mortgage can be tricky. While it is entirely possible to do so, there are a variety of factors to take into consideration.

What is an eligibility check?

If you wish to transfer the ownership of a house with a mortgage to a new owner, then your lender will first need to perform an eligibility check. This enables the lender to assess whether the proposed new owner(s) of the property will be able to continue with the same mortgage. This will include whether the new owners or joint owners:

  • Can pass a credit check
  • Have sufficient income to be eligible for the existing mortgage
  • Meet the appropriate age requirements
  • Have residency in the UK

What happens if the new owner fails the eligibility check?

If you do not meet the requirements set out by the mortgage company, then an alternative will be to either find some way to remortgage the property or pay off the existing mortgage in order to transfer ownership.

Are there any restrictions on transferring the ownership of a property with a mortgage?

In addition to passing your lender’s eligibility checks, there are other factors that could prohibit you from transferring the ownership of the property with the existing mortgage. These include:

  • If the property is buy-to-let and one of the ‘new owners’ intends to live in the property
  • If a person being removed from a mortgage will still be living in the property – at the very least they will need to waive any rights to occupation.

Conditions vary from lender to lender and so it is important to get in touch with them as soon as possible in order to find out if there is anything that could affect your ability to transfer ownership.

Transferring ownership – how does it work?

If the transfer has been approved by your lender, or if the mortgage has already been paid off, then the process works a number of stages. These stages include:

  • Contact solicitor to prepare a transfer deed, and if a mortgage is involved a new mortgage deed
  • The solicitor will deal with the registration of the transfer at HM Land Registry
  • Be aware that if the property is leasehold (for example an apartment) you will have to inform the landlord and will have to pay notice fees to them
  • Check with your solicitor to find out if you are liable to pay Stamp Duty
  • You may be exempt from Stamp Duty if the transfer of property ownership is taking place as part of a divorce settlement

Free Initial Discussion

To find out more about how to transfer the ownership of a property with a mortgage, contact our residential property solicitors today for a free, no obligation initial discussion on 0161 929 0121. Or alternatively fill in our online enquiry form or email us on and a member of our team will contact you.

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