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After sale shared equity procedures: guidance 2019

Updated guidance on procedures to be followed for all after sale transactions related to shared equity properties.

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2 Change of Owner

If an owner wishes to either add someone else to the property title or remove someone who is currently named in the title deeds, they should in the first instance ask their legal and /or financial adviser to approach their lender to seek their approval and at the same time contact the RSL who should send the owner one of the following:-

  • Letter/email – Proposed change of Shared Equity Owner – Person Added (Annex 1A) incorporating Form for Additional Shared Equity Owner (Annex 1B)
  • Letter/email – Proposed change of Shared Equity Owner – Person Removed (Annex 1D) incorporating Form for Removal of Shared Equity Owner (Annex 1E)
  • Copies of correspondence from you [and the estate agent] in connection with the sale.
  • A copy of the Home Report together with Letter of Reliance from the Valuer addressed to us/ Scottish Ministers in terms annexed. As you will note a copy of the Shared Equity Agreement will require to be sent to the Valuer. The valuation contained within your home report should be dated within the past 6 months and if it is dated earlier than that a refresh valuation will require to be carried out.
  • Details of all offers made and confirmation of which one the Owner proposes to accept in order to enable the RSL and Scottish Government to be satisfied that the terms of the Shared Equity Agreement have been met.

Depending on which letter/email (1A or 1D) is sent to a shared equity owner it should contain a note of what the RSL’s fees will be and it should note that those fees will be payable in advance and are non-refundable. It is therefore important to advise the owner to be satisfied that their lender will approve whatever arrangement they are proposing before they proceed with paying the non-refundable fees.

Once the RSL receives a completed form from the owner, they should send an email to Harper Macleod in the form set out in Annex 1C or 1F.

Harper Macleod will draft the relevant documentation for execution by the Primary Lender, the owner(s) and the RSL or Scottish Ministers depending on whether the documentation was entered into pre- or post– 6 April 2008.

Scottish Ministers consider it both unnecessary and inadvisable to discharge and reconstitute their security and will not be doing so. Provided that there is no change to the Primary Lender Priority Debt (as defined in the ranking agreement), no Valuation is required. In some instances the Primary Lender may wish to proceed by way of a discharge and the creation of a new security to secure the primary lending. There will be different documents and an increase in costs for the applicant if the Primary Lender proceeds in this way.

Harper Macleod will advise the RSL and Scottish Government when the matter has been completed. Upon completion the RSL should submit a ‘project change request’ in HARP to provide information about the change of name and the property address. If possible the HARP Property Reference Number should be provided.

Contact

Email: SharedEquityEnquiries@gov.scot

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