Transfer of Equity Conveyancing - First Direct Panel Requirements
The content on this web-page was fashioned to assist E&W conveyancing solicitors carrying out Transfer of Equity conveyancing who are on the First Direct conveyancing panel. It is not intended as an alternative to reviewing First Direct Part-2 instructions
As a conveyancer you must approve the transfer (which should be in the Land Registry's standard form) and, if First Direct require, the deed of covenant on their behalf. See below to see if First Direct have standard forms of transfer and deed of covenant
Does First Direct have a standard form of transfer of equity /deed of covenant?
Instruction: Where you are instructed to act on behalf of the Bank on a transfer of equity, you will be notified by email of the instruction by us. The instruction will include a copy of the mortgage offer addressed to the borrower, you will not normally receive a mortgage offer addressed to you.
Standard Documents: to download the legal document templates and our Mortgage Lending Instructions & Guidance Notes for England & Wales, Scotland and Northern Ireland (which contains additional information on our requirements) visit Legal instructions for moving home as www.firstdirect.com/legal-instructions.
Requirements: If you are unsure as to the changes required, please contact us per 1.11a
You are required to ensure a new mortgage deed is signed for the transfer of equity and to register a new first charge by way of legal mortgage over the property on behalf of HSBC UK Bank plc trading as first direct.
The bank will not agree to a transfer of equity subject to our existing charge and as such, will not be a signatory to the transfer deed. You must not send us a copy of the transfer deed, which should be signed by the transferors and transferees only.
When drafting or approving a transfer of equity, you should bear in mind that:
- although the transfer should state that it is subject to the mortgage (identified by date and parties), it need give no details of the terms of the mortgage;
- the transfer need not state the amount of the mortgage debt. If it does, the figure should include both principal and interest at the date of completion, which you must check (see below for where to obtain this);
- there should be no statement that all interest has been paid to date.
If different from 1.11 of First Direct UK Finance Lenders’ Handbook Part 2, contact point for finding out the debt amount:
As a conveyancer on the First Direct panel you must ensure that every person who will be a borrower after the transfer covenants with First Direct to pay the money secured by the mortgage, except in the case of:
- an original party to the mortgage (unless the mortgage conditions are being varied); or
- a person who has previously covenanted to that effect.
Any such covenant will either be in the transfer or in a separate deed of covenant. In a transfer, the wording of the covenant should be as follows, or as close as circumstances permit: "The new borrower agrees to pay the lender all the money due under the mortgage and will keep to all the terms of the mortgage." If it is in the transfer, you must place a certified copy of the transfer with the deeds (unless First Direct tell you not to in their CML part 2 requirements, please see below).
Does First Direct need to be sent the transfer of equity?
No, as we do not want to be a party to the transfer. A new charge will be taken at all times
If First Direct have agreed to release a borrower or a guarantor and their standard transfer form (if any) includes no appropriate clause, you must add a simple form of release. The release clause should be as follows, or as close as circumstances permit: "The lender releases ... from his/her/their obligations under the mortgage." You should check whether a guarantor who is to be released was a party to the mortgage or to a separate guarantee.
You must obtain the consent of every guarantor of whom you are aware to the release of a borrower or, as the case may be, any other guarantor.
You must only submit the transfer to First Direct for execution if it releases a party. All other parties must execute the transfer before it is sent to First Direct . See First Direct part 2 requirements for where the transfer should be sent for sealing. The UK Finance Lenders’ Handbook Part 2 also gives First Direct approved form of attestation clause - see below:
If different from 1.11, First Direct contact point for obtaining execution of transfer equity:
What form of attestation clause does First Direct use?
This will not be required in transfer of equity cases as a new charge will be taken in all cases
Find out how to order your redemption statement request from First Direct