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Thread: What to do if I cannot meet the mortgage repayments?

  1. #11
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    Quote Originally Posted by EmmaR View Post
    Our bank manager in Murcia told us that it was free to extend the mortgage term only if you are a Spanish resident. Is this the case?
    Thanks.
    Dear Madam,

    The paragraph quoted above specifies the property must be your permanent/main dwelling which implies you have to be resident to take advantage of this option, yes. In fact all the economical measures taken by the Government to ease the financial situation are really aimed at residents as only they will be able to benefit from them.

    DISPOSICIÓN ADICIONAL SEGUNDA. No sujeción al gravamen establecido en el artÃ*culo 31.1 del texto refundido de la Ley del Impuesto sobre Transmisiones Patrimoniales y Actos JurÃ*dicos Documentados de las escrituras públicas de novación de préstamos con garantÃ*a hipotecaria que se refieran a la ampliación del plazo del préstamo.

    No obstante lo previsto en el apartado 1 del artÃ*culo 31 del texto refundido de la Ley del Impuesto sobre Transmisiones Patrimoniales y Actos JurÃ*dicos Documentados, no quedarán sujetas a dicho gravamen y se extenderán en papel común las escrituras públicas que documenten la ampliación del plazo de los préstamos con garantÃ*a hipotecaria concedidos para la adquisición, construcción y rehabilitación de la vivienda habitual realizadas en el periodo de dos años a contar desde la entrada en vigor de este Real Decreto-ley.
    Last edited by Lawbird Lawyer; 03-02-2009 at 04:15 PM.

  2. #12
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    Default extension of our mortgage

    I wrote to you previously saying that we have already extended our mortgage in september of last year. We have approached our bank informing them of the law that was passed in April 2008 as we meet all of the criteria for not paying the notary fees for the extension, but they are insistant that we are only exempt from paying the fees if we extend the term of our mortgage by only 2 years, and as we have extended our mortgage by 10 years the law does not count. Are they correct? your help would be appreciated.

  3. #13
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    No, they are incorrect. The law doesn't mention at anytime that the extension has to be for 2 years. No one extends a mortgage for 2 years only, makes no sense financially as it will hardly reduce the monthly repayments which is exactly why one requests this extension in the first place.

    This can only be achieved, as it stands to logic, through significant extensions of 10, 15, 20 years which will effectively greatly reduce the monthly repayments (although in the long run you will pay dearly for this privilege with increased interests).

    Are you sure you are resident in Spain and this is your main permanent dwelling you are requesting the extension for?

  4. #14
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    Default extension of mortgage term

    Thank you for your reply I will be showing it to my Bank Manager, in answer to your question we have been resident in spain since 2006, my husband had obtained his certificate of residency in 2007 and I obtained mine in 2008 - 2 months prior to the mortgage extension.

    Regards

  5. #15
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    You're welcome Madam.

  6. #16
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    Default Extension of mortgage

    Quote Originally Posted by Unregistered View Post
    Muchas gracias
    Hello – 5 years ago I took out a mortgage to construct a swimming pool and small extension and to carry out minor renovations to my villa – it has become increasingly difficult to meet the mortgage repayments per month so I contacted my bank to extend the term of the loan – the bank agreed but say I must pay all the relevant costs and charges ( about 1500 euros ) I spoke to my bank about what I had read on your forum and I emailed them the new law – I received an email from them saying that the construction of a swimming pool and the renovations I carried out were outside the constraints of the new law – they say the new law was to be applied to mortgages that were taken out only for the purpose of either buying the house – constructing a new house on a piece of land or totally renovating a house from a ruin.
    I have copied their email below – Can you please tell me if the bank are correct in their interpretation of the new law .I feel I am entitled to the free mortgage extension.

    Hello Eunice,

    Regarding to our conversation before, I copy the part of the new law regarding free extension.
    Your mortgage was asked to cover costs of swimming pool and alterations of your house, the target of these operations are not incluided in the current law.

    "Como medida para favorecer la situación económica
    de las familias, a la vista del alza experimentada por los
    Ã*ndices de referencia que se utilizan para fijar las cuantÃ*as
    de los intereses de los préstamos hipotecarios, en la disposición
    adicional segunda, se prevé que en las operaciones
    de ampliación del plazo de préstamos con garantÃ*a
    hipotecaria concedidos para la adquisición, construcción
    y rehabilitación de la vivienda habitual, los titulares del
    préstamo podrán disfrutar de la no sujeción de la cuota
    fija de la modalidad de actos jurÃ*dicos documentados, en
    el Impuesto sobre Transmisiones Patrimoniales y Actos
    JurÃ*dicos Documentados, por el otorgamiento de documentos
    notariales, que graven estas operaciones, que
    podrán extenderse en papel común.".

    Kind regards,

    CAM INTERNACIONAL 0569- CALAHONDA, MIJAS

  7. #17
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    Dear Madam,

    The law you mention has as an aim to help those struggling mortgage borrowers with their primary residence (three years) by means of providing free mortgage repayment extensions on three accounts.-


    1.-Adquisiciónc vivienda habitual. Purchase of primary dwelling.
    2.-Construcción v.h. Construction of p.d.
    3.-Rehabilitación de v.h. Refurbishment of p.d.

    Your query hinges on point three, what is understood by "rehabilitación de la vivienda habitual" which is a legal concept.

    The definition comes in Spain's IRPF law.-

    Concepto de rehabilitación de vivienda.

    A efectos de esta modalidad de deducción, se considera rehabilitación de vivienda habitual las obras realizadas en la misma que cumplan cualquiera de los siguientes requisitos:

    1.- Que las obras hayan sido calificadas o declaradas como actuación protegida en materia de rehabilitación de viviendas, en los términos previstos reglamentariamente.

    2.- Que las obras tengan por objeto la reconstrucción de la vivienda mediante la consolidación y el tratamiento de las estructuras, fachadas o cubiertas y otras análogas, siempre que el coste global de las operaciones de rehabilitación exceda de los lÃ*mites establecidos en el Reglamento del Impuesto.

    After having examined the definition of what's understood in law by "rehabilitación de la vivienda habitual" one concludes that the type of work you've undertaken (build swimming pool and small extension) are not included in the definition, therefore outside the help of this law.

    Therefore your lender is right, I'm sorry, you will have to pay for the expenses.

    Yours faithfully,
    Raymundo LarraÃ*n Nesbitt

  8. #18
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    Thank you very much for your advice - I feel the law should also include people like myself who applied for a mortgage to improve their property - I did not ask for a mortgage to spend the oney on a new car and expensive holidays or to pay off other debts - the whole amount of the mortgag was spent on improving my property - I too am hit very hard by the current financial situation and the free extension of the mortgage would have been very welcome - this is my only home - I feel that I have been discriminated against by the new law - thanks again for your help

  9. #19
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    Dear Laurie,

    I understand your concern. Unfortunately I'm helpless to aid you. I can only construe what the law says.

    The law passed on is clear on this point.-

    Additional disposition number two.


    DISPOSICIÓN ADICIONAL SEGUNDA. No sujeción al gravamen establecido en el artÃ*culo 31.1 del texto refundido de la Ley del Impuesto sobre Transmisiones Patrimoniales y Actos JurÃ*dicos Documentados de las escrituras públicas de novación de préstamos con garantÃ*a hipotecaria que se refieran a la ampliación del plazo del préstamo.

    No obstante lo previsto en el apartado 1 del artÃ*culo 31 del texto refundido de la Ley del Impuesto sobre Transmisiones Patrimoniales y Actos JurÃ*dicos Documentados, no quedarán sujetas a dicho gravamen y se extenderán en papel común las escrituras públicas que documenten la ampliación del plazo de los préstamos con garantÃ*a hipotecaria concedidos para la adquisición, construcción y rehabilitación de la vivienda habitual realizadas en el periodo de dos años a contar desde la entrada en vigor de este Real Decreto-ley.

    The mortgage loan granted by the lender is not for either of the three reasons allowed by the law regarded to be exempt.-

    1.- construction of a permanent dwelling.
    2.- purchase of a permanent dwelling
    3.- refurbishment of a permanent dwelling

    All of us are suffering this financial crisis.

    Kind regards,

  10. #20
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    Thanks again for explaning in detail the criteria of the new law

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