What is the process for transferring property without a sale?
Transfer to an individual
Homeowners may decide to transfer a property to a family member while they are still alive, to minimise any inheritance tax which would otherwise be due. Such transfers are known as ‘lifetime transfers’, ‘potentially exempt transfers’ and ‘PETs’. In order for this to be effective, the transfer must take place at least 7 years before they die. There are various other reasons for transferring property to an individual as a gift.
Transferring property into one name or into joint names
Homeowners will often decide to add the name of their spouse to their property deeds when they get married. The opposite may take place upon divorce or separation. In either case, Form TR1 needs to be used (as with the transfer to an individual). A Declaration of trust may also be required. It is a good idea to seek advice from a lawyer on your particular situation.
If a property is inherited as part of the estate of the deceased, the regular probate process will cover the transfer of property. Probate involves applying for a grant of probate or a grant of letters of administration by filling in a 'Probate application form' (Form PA1P or Form PA1A). For more information, read Probate.
What is the process for conveyancing if the property is being sold?
There are various different aspects to conveyancing, but the main aspects which relate to the transfer of property involve the exchange of contracts, resulting in completion.
What must be included in the conveyancing contract?
Once an offer has been accepted, the seller (or their lawyer) must draw up a contract that includes details about:
fixtures and fittings
planning and other legal restrictions
services (eg drainage) to the property
What is the exchange of contracts?
Once both parties have agreed on the contract, they make it legally binding by signing final copies and sending these to each other.
What is completion?
Completion takes place once the money has been transferred from the transferee to the transferor, the relevant legal forms effecting the transfer of property (ie TR1) have been finalised and the keys have been handed over.