I recently went through this process with Pepper, I had 2 BTL's on interest only which were cross charged. For both properties, the amount outstanding on the loan was less than the market value. You need to go through a 'consent for sale' process with Pepper, basically you submit an email with your proposal e.g. I wish to sell Property A for 150k, amount outstanding on loan is 100k, after I take out costs (auctioneer, legal etc..), the amount remaining is 45k. I will reduce the loan on Property B with the surplus 45k.
Even though my case was straight forward, no negative equity, I was moving the full surplus onto the loan on property B - it still took 8 weeks for Pepper to make a decision. Their credit committee meets once a week on a Thursday and they may not get to your request.
If you have CGT due, then you need to build that into your case.