- Have you paid a deposit for a property that never materialised?
- Have you a Spanish mortgage?
- Have bought a property in Spain?
- Have you sold a Spanish property at a loss?
- Do you own a Spanish property in negative equity?
- Would You benefit from general legal services on property?
When investments in Spain go wrong…
Have you tried to purchase property in Spain? Put down a deposit? Fighting to get back a deposit? Bought a Spanish mortgage? Or sold a Spanish property at a loss? Have a Spanish property in negative equity? If any of those scenarios sound familiar to you, then you may be owed money.
Recent changes in Spanish law have resulted in Irish citizens who have lost money or been overcharged to reclaim monies owing to them.
Prior to the new Supreme Court cases, Irish citizens found it very difficult to negotiate unfamiliar judicial systems, foreign language issues and lack of protection for overseas consumer rights. In addition, any attempts to recover money often resulted in high legal costs without any accompanying reversal of funds.
This has all changed. The new Supreme Court laws mean that consumer protection is now afforded to Irish citizens at district court levels.
We have teamed with up a top legal firm in Spain, Ridalaw, to offer Irish citizens the opportunity to recover money, deposits, illegal taxes and levies at no risk to themselves. Ridalaw will investigate each case on an individual basis and determine if funds can be recovered. Ridalaw will not charge any fees until the monies are recovered.
This ‘no foal – no fee’ contract ensures all suitable Irish clients will only pay commission on successful repatriations of monies.
There are a number of scenarios that allow Irish citizens to reclaim monies.
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Payment of deposits for buildings that never materialised
Under Spanish law from 1968, the responsibility for repatriation of deposits from failed housing projects lay with the banks but this was not enforced. Under new legislation passed in the Supreme Court in 2015, regardless of whether the developer went bust or went into hiding, the banks are now held directly responsible.
Many Irish citizens were caught in this scenario where deposits were paid in good faith but the apartments complexes were never built. Without the new law, Irish citizens attempted to chase the developer for the return of their money, mostly without success.
Now, it is the role of the banks to return the money, not the developer.
Excessive bank charges on mortgages
If you hold or held a Spanish mortgage, it is possible you were overcharged interest.
Spanish banks did not pass on the record low interest rates to their customers using a local ‘Floor Clause.’. However, the European Court of Justice (ECJ) ruled that a Spanish Supreme Court Decision to cap preferential rates contravened European Law.
Spanish banks are now forced to repay the overcharged interest to their clients.
Excessive mortgages setup charges
In December 2015 the Spanish Supreme Court found that Spanish banks had levied unreasonable costs on their clients. It ruled that these costs were null and void. The law argued that the banks should have paid for these costs as they were holders of the asset (the mortgage) and not the clients who instead held the liability (the mortgage).
Typical mortgage setup costs included the notary fee, administrational expenses, land registry fees and stamp duty.
As an example, a mortgage of €140,000 would attract fees in the region of €3000.
Fees paid at sale of property – at a loss
Did you sell your property at a loss? Then you may have paid local council fees which were incorrect.
Spanish law allows local councils to charge ‘Plusvalia tax’ in addition to government CGT. However, the ‘Plusvalia tax’ was calculated on an annual increasing rate – not taking into account that property could fall in value. In May 2017, Spain’s Constitutional court ruled that this tax could not be charged if the property sold at a loss.
Do you own a distressed Spanish property
Perhaps you bought at the peak of the boom and now own a Spanish Property in negative equity. Perhaps your financial circumstances have changed materially since you purchased your Spanish Property.
Regardless of your new financial circumstances, Spanish banks will expect you to continue to service the mortgage payments. If you are forced to sell the property for less than the mortgage, you will still need to pay off the remaining residue.
We can help.
General Legal Services on Property
We can assist you in the purchase of property in Spain.
Spanish Will
This is the last piece of the jigsaw. Without a Spanish will, probate can be very long-winded. In addition, in the absence of a will, Spanish law forces assets to be divided equally among heirs, and to leave 2/3s to the children. If you wish to divide your assets differently then a will is required.