Home Repossessions in Spain: A Legal Perspective [Archive] - Page 2

worried lady

02-08-2011, 12:01 AM

We are having problems paying our mortgage, and are now 1 month in arrears due to a reduction in income. We do have a small business here, but
business is seasonal, and we rely a lot on people coming on holiday. We have contacted the bank, and they have been understanding, but for how long?
To complicate matters, we are renting our house in the UK to a family member, and it woud be awful if we were to lose this as well. I am at my wits end to know what to do, and my husband seems to be putting his head in the sand and pretending everything is ok. I would be grateful if you could give me some advice. It would be very much appreciated and might ease my anxiety. I have thought about going back to the UK alone, but do not want to be a burden on my family.

Unregistered

03-21-2011, 07:05 PM

hi I bought a property in almeria 5 years ago and paid half and borrowed half on a spanish mortgage unfortunately I lost my job last year and have struggled to pay since. so I asked my bank manager if I could hand back the keys and he told me there is a problem with the paper work because of this thing going on between the local government and regional government (la junter) or something and he says it will be sorted out this year some time and he will take it (my apartment)back then. but until he has offered me interest only mortgage for 1 year, or repossession. I still can't afford interest only so is repossession the only way?

Patricia

03-24-2011, 05:03 PM

Dear Sir,

Unfortunately, this situation is not infrequent. Your options are these:

1. Accept the one year interest mortgage offered by your bank or renegotiate a different arrangement
2. Negotiate repossession, which is entirely up to the bank to decide on the terms and conditions, as you mayhave read former informatin on this thread.

In the event that none of these options were possible for you and your current financial situation led to the non-payment of the mortgage fees, the bank could decide to start a court action against you.

Best Regards,

Kathy

04-08-2011, 01:44 PM

Hi
I am in arrears but paying the full mortgage and some arrears. Have I got a defence when it comes to court? There is no month I paid nothing.
Thanks

Kay

04-08-2011, 07:46 PM

Advise needed regarding property in Tenerife
This may be a tough one to answer it sure is a hard one to ask advice on but i cant think of anyone to turn to for this advise
Well here goes

I came back to the UK in 2009 to work due to circumstances beyond my control I had mortgage problems I did let the bank know that I was leaving and explained that i was going to work and asked for a few weeks to get sorted back in UK this was Ok I kept in contact via email they went through all the process of asking for copies of everything as they do I was at one point told that my bank account had been closed I was not given any information where I could pay any monies to. I have tried for two years now to get some response from the bank and they never reply I just don't know where to turn I have little money for big lawyers fees so any advise would be appreciated

I had my apartment trashed a few weeks after returning to the UK but have been unable to get across

I have since found out from a friend that when she was over in January they saw what looked like cleaners on my balcony it transpired that they thought that I had sold up and had just left a lot off stuff behind

My daughter who is 17 is over there at the moment and has just been to the apartment having had to get in through a window as a key had been broken in the lock to find that everything has gone my beds my clothes my fridge my washer my dryer every thing apart from 2 sets of drawers and a unit
I have like i said tried to communicate with the correct people but they have not bothered to communicate with me

WHAT DO YOU THINK I CAN DO ?

Sorry for the rambling but i am in a state of shock at the moment

Marta

04-12-2011, 06:54 PM

Hi Kathy,

Unfortunately there is not defense to this. Banks normally begin the repossession procedures after 91 days of delay in repaying the full amount owed. This normally equates to the 4th unpaid mortgage receipt. However having said this, it is important to note that the bank will reserve their right to initiate repossession as soon as you are late by one day, for example.

graham

04-13-2011, 05:34 PM

Hi"
last week i recived a letter from my bank
witch was all in spanish !
so could not understand. i have been asking them to take the keys back for quite some time now, as my partner dyed just over a year ago,
and since then i have struggled to keep up the mortgage, witch i now have not been able to pay since november last year,
all the bank kept saying was that i had to pay inhearatence for my late partners half of the apartment.witch i canot afford !
then the apartment would be all mine!
unless i did this i could not sell the apartment to get rid,
as i had a buyer wanting it,
but the bank would not let me sell it to them, witch would have paid off all the outstanding mortgage and left a little over ,
the letter was an offical one i had to signe for,
from the bank,
but i sent straight back and asked them to send it back in english so i could understand it !
but they have just not bothered to reply.they have constently not replyed to my letter and emails and phone calls regarding sorting this out,
so it looks now as though its going to repossesion i think, so how do i stand ?

Marta

04-13-2011, 06:48 PM

Hi Kay,

I am sorry to hear about the difficulties you have been through.

With regards to the problem regarding the bank, this is indeed very strange. The only thing I can think of is that they would have already repossessed your property and closed your account. If you are not able to come to Spain in person, I would recommend engaging the services of a lawyer in order to find out what has happened to your bank account and property. This doesn't necessarily mean huge fees. Law firms tend to charge in accordance to the complexity of the matter. Please contact us and I will give you a quote.

It would also be convenient to request a land registry search in order to find out if you are still the title holder of this property. Your situation must be clarified as soon as possible as it could be that you are in debt with the bank and if this is the case, it could affect any assets you hold in the UK.

The so called 'cleaners' could have been people sent by the bank in order to seize all your assets.

Patricia

04-23-2011, 08:43 PM

Dear Graham,

Welcome to the belegal forum.

The bank is failing to send you the letter in English as the official language in Spain is Spanish and they are not obliged to send you the Communications in English.

As your partner has passed away, the bank understands that the property has been left to you in the will. You do not mention if you have accepted the inheritance before the Notary already, and this is an important data. In order for the property to be legally yours in a 100%, the inheritance must have been accepted and the Inheritance taxes paid, otherwise you are unable to sell the property, as it is not considered yours. The bank is considering this, as they´d rather transfer the ownership to you so you have the opportunity to sell it and pay off the mortgage ( if possible, leaving still funds available for you ), otherwise they will go on for the repossession of the property.

Our advice is that, once the transfer of the estate has been formally processed and inheritance taxes have been paid, the exact amount due to the bank ( as there will be interests on default ) is checked in order to set a selling price that covers the mortgage plus expenses.

The legal assistance of a bilingual solicitor is crucial in this case, to provide with their legal advice all along the process, be in charge of the property sale and also translate the formal documentation, that will naturally be in Spanish language.

If you would like to obtain a quote from a solicitor, please do not hesitate to contact us at info@lawbird.com.

Kind regards,

Fay

04-25-2011, 01:03 PM

Unregistered

04-25-2011, 01:55 PM

We fell behind with mortgage payments but the bank said they would be ok with what we were paying into the account as long as it didn't reach 3 months arrears. We actually paid cash into our current account for the full amount to bring the mortgage payments up to date and asked for it to be transferred to the mortgage account (held at the same bank). Unfortunately, the money remained in our current account for several days for no apparent reason and it was only clear when we went to pay the following month's mortgage payment and was told we had to pay an additional €3000 for legal fees! We explained we'd already paid the mortgage up to date so why were legal proceedings even started? We were told to pay the extra €3000 or we would lose our home but we didn't have €3000.

It went to court last April but we weren't notified and still haven't had an eviction notice. Is there any way we can find out what is going on? Also, because the account was paid up to date and never fell 3 months behind is there anything we can do now because we still don't understand why they kept the money in our current account instead of paying it to the mortgage. Our bank statement proves this was the case.

I just wanted to add that I've just found a website that said the following is correct procedure:-

1. Lender writes regarding arrears - this never happened.

2. Lender makes last attempt to get arrears paid once the mortgage is 90 days late - this never happened.

3. 10 to 30 days after default a Requerimiento Notarial or certified fax is sent - this never happened.

4. 7 days later legal action of a repossession order is issued - this never happened.

At this point all we knew is that the bank were telling us we had to pay an extra €3000 for legal fees but we never received a letter or phone call from their lawyers.

5. Court sets an auction date and if the property isn't sold the lender buys it for 50% of its value. The new owner (bank?) is registered at the Land Registry. We have no idea if this happened because we've never received any paperwork or correspondence regarding the repossession apart from a court date sometime last April (2010). Is there any way to find out what happened at the court hearing and whether there has been an auction?

6. 6 months after auction an eviction notice is served and locks are changed. This hasn't happened.

Basically we have no idea what happened at the original court hearing, whether there's been an auction, whether the bank purchased the house or someone else did. The locks haven't been changed and no eviction notice has ever been received but no-one is living in the property. Is there any reason we wouldn't have received any letters apart from the original court hearing? How do we find out what, if anything, has happened?

Do we have any legal standing because the above procedure wasn't followed. I assume we would have had to sign for any correspondence sent via Beaurofax.

Daragh Hyland

04-27-2011, 03:43 PM

Why dont people, find out if anybody would take over their mortgage payments and just hand over the key's to them. They could draw up a legal agreement with the persone, that when the mortage was paid off they would sign it over to the purchaser.

Patricia

05-09-2011, 05:37 PM

worsel66

05-19-2011, 07:19 PM

I purchased a property in Spain and as I was a pensioner was unable to get a mortgage my son obtained a mortgage but I am on the escitora he has since defaulted and the house is being reposessed will they try to take my assets in the uk or just his

spain house

05-19-2011, 08:42 PM

We have a house in Spain, but we stopped paying the mortgage over 2 years ago and there is no equity in the property at all. Our lawyer in Spain received a letter from the bank 18 months ago saying that they were going to start court proceedings but we have heard nothing since. We have no assets in the UK and live in the Middle East. Can they come after us in this area of the world? Whilst we have no assets now, we might acquire some in later life. Will this stay with us for the rest of our lives? The total debt is over Euros 400,000....

allan

05-22-2011, 10:34 AM

gary.s

05-24-2011, 09:21 PM

My house is valued at 402000 euros,By the Bank,I have not been able to pay 3 months mortgage,My mortgage is 68000 euros,will they take action or will they negociate due to the Equity in the value,Regards,Gary.s

Marta

05-25-2011, 05:11 PM

Hi Gary,

The bank will most probably initiate a judicial process in order to seize your property. No matter how small the debt is. Try negotiating with them a payment method with which you feel more comfortable. For example increase the term, lower the interest rate and minimum rate ( clausula suelo), or negotiate an interest-only period. If you are having difficulties in keeping up with your repayments this will give you some time to put the property on the market.

Unregistered

05-26-2011, 06:42 PM

Some advice if posssible.

Son and Daughter in law simply cannot afford monthly repayments on their home as he has no work.

They have tried in vain to get bank to move them on to interest only and were told if they brought arrears up to date this would happen. We gave them the money to bring up to date then bank reneged.

They are now considering defaulting and renting a property as life is intolerable and the choice is whether to pay the electricity bill and feed the children, or pay the mortgage.

If they move out and hand keys back what are the repercussions?

They have no other assets.

Daughter in law has work but the mortgage payments are over 50% of her income.

Can the bank claim her income??

Hi Allan,

We are in the same situation. We fell behind last year and asked to remortgage or go interest only but the bank wouldnt help unless we paid our arrears, at that time around 3000 euros. We didnt have that and when we asked them to help by possibly remortaging and putting the arears together they again said they wouldnt help and told us to borrow the money from friends or family!! Not really a professional helpful response. We didnt do this, and at the time we too were concerned that even if we did manage to clear the debt that they wouldnt then help. In your case it seems that we would have been right.

We continued to pay our monthly payments into our bank account but they never deducted it off our mortagage. When we noticed this they told us that our account was frozen. They then eventually took this money at a later date for charges, all of which were never explained to us.

Anyway we have now not made any form of mortgage payment since the beginning of the year. Like your son and daughter in law we are just scrapping by. Our business here in Spain has all but virtually ceased now and we are just trying to get a little money together to return to the UK and try and get some work over there. We are doing odd jobs and cleaning jobs just to try and eat. We are behind on our community fees and electric payments.

We are in slight negative equity which doesnt help our situation. We asked the bank to take back the property and they said no. We explained our financial situation to them and they said that they were not interested and that they would take us to court and the debt will be against us for life. We said we would rent out the property so at least they would have a tenant also but again not interested.

We have no assets in the UK or elsewhere except a 10 year old car which will probbaly have to go soon. No one seems to want to help so it seems we will just have to go along with the repossession.

They were more than happy to throw their money around 5 or so years ago, they over valued our property so that they could give us the mortgage but now the problems have occurred they do not seem at all interested in helping.

Anyway ill update this post if we get any where with the bank though im not that hopeful. Any one who can give us any advice would be much appreciated.

Unregistered

05-26-2011, 06:49 PM

me and my wife are in the same situation, in arrears, bank wont help, not much income coming in, in negative equity, tried to give it back bank said no, no assests elsewhere. let them come after me, i dont have any money to give them

Patricia

05-31-2011, 01:59 PM

Hello Worsel66,

Welcome to the belegal forum

Legally, they can go against your and your son´s assets in UK for the pending debt, but this is entirely up to the bank. They will decide how to proceed depending on their interest.

Lynsey

06-10-2011, 09:58 AM

I need advice please, 2 years ago we were in a very difficult financial situation, the bank offered us a 2 year interest only on our mortgage, aslong as we had insurance and pensions with them !!! 2 years is up in 3 weeks, we have been in contact with our bank over the last 6 months, to advise that we will not be able to pay the increase from 600 a month to 1055 a month ! We have never been in arrears.

We have been offered 2 options .

Both of which I am very worried about.

1 . New mortgage to cover the original, and charges 6,500 euros for notary commission, solicitor, valuation ect.

My worry about this is our property does not match the Registro, the Catastro has the correct info but not the Registro. 4 years ago we had an extension, we had the wrong Licence, Licencia Menor, not Obra Nueva !! We have paid impuestos on the work...but it has not been signed off by an architect extra. If we chose this option, would this cause us more problems, or open a can of worms.

2 nd Option, to extend the terms on our mortgage from 18 years to 25 years but 6.5 % fixed ! & with set-up charges of 1800 euros - 680 Notary, 300 bank commsision - 500 Registro and 300 Solicitor. Do these charges seem realistic. We can not pay these charges, as we have no money and that is why we are asking for help.

We have a meeting with the bank on Monday..The new mortgage would be best, but I am worried, it will cause problems.

Please advise would be gratefully received.

Patricia

06-13-2011, 01:47 PM

Hello Allan,

Sorry for the late reply.

Unfortunately that is the situation for many families nowadays.

We understand that your query is related to a Spanish property and mortgaged by a Spanish bank. If we are right, the first thing that your son and daughter-in-law must do is to try and obtain the possibility to process a Dacion en Pago with the bank, that is , handing back the keys of house to the bank as payment of their debt. This is formalized on public deeds and the bank will not claim anything else in relation to the property. Another possible option is that the bank accepts the house as payment of the debt but requests the debtors that they sign a debt recognition certificate for the amount resulting from the difference between the full debt and the current value of the house.
In the event that the bank does not accept any of these options, just " handing back the keys" is not possible, so no matter how many times you deliver the keys on the Bank officer´s desk, they will ignore that fact and initiate the bank repossession through legal means. If the sale of the property does not cover the full debt, the bank can , as per current regulations in Spain, claim the pending debt by seizing and putting embargoes on any assets in the debtors name ( In Spain and/or abroad ) , such as other properties or bank accounts. In order to recover their money, the bank can even hold on to your salary and benefits ( pensioners benefits, etc ) up to a 30% .

These are the options according to law, as in practice the bank often prefer to lose the money rather than start legal actions and take the debtors to court as the processes are generally long and expensive, needless to say how expensive they can be when they have to prosecute debtors out of Spain.

If they start defaulting, the bank will claim their debt, not only claiming the principal debt at the due date, but also late payment interest and compensatory interest, together with the court expenses.

I hope this information has been useful.

Regards,

Patricia

06-21-2011, 06:31 PM

Hello Lynsey,

Please accept our apologies for this late reply. As you had a meeting with your bank last week, we would like to know what was the outcome of it and what was their comment when you brought up your concern with the Land Registry and Catastro. Initially, if the said property has the registration incorrections that you describe, the bank will not agree to extend the mortgage, unless these are corrected.

Regards,

Martin

07-08-2011, 08:09 AM

One thing I have learnt in spain is that never, never never trust a bank or a bank manger here in spain, they are devious and will get you into more trouble. I was having trouble paying my mortgage so decided to rent the property out and rent a smaller place myself the rent would cover the mortgage. No problem I thought the bank was informed and everything fine you would think. NO the tenants started to default in paying the rent and bills, I had literally 15 to 20 meetings with the bank I even spoke to their head office and was told to speak to the manager at the branch it was their problem. The walls were put up, I tried desperately to negotiate with the bank myself then via a solicitor, trying to give them the keys back (dacion en pago) The bank refused because of the tenants, so I spent 2000 euros in putting it in the hands of the solicitor for eviction of them in the meantime they continued not to pay the bills and rent. The bank had our address, telephone numbers, e-mail address and also our solicitors details and never contacted us and we found in March this year we received a demand from the Court that the bank had got permission to sell the property at auction and we found out it is in October 2011. In the meantime we went to court with the tenants who incidentally did not turn up and was granted the eviction of the tenants which is due to take place on 27th July. Before the court trial the bank agreed to do the dacion en pago (hand the keys bac) with the tenants still inside but we wanted our furniture and personal belongings back so informed the bank that we would do the dacion en pago after the tenants were evicted the bank then took 3 weeks to answer and informed us that they now would not do the dacion en pago and would take full legal action against us unless we came up with all the outstanding monies. We only had a small mortgage when we first had tenants in the property of 100,000 euros because we were living in rented paying our bills and rent and paying the bills at our property and not recieving anything from the tenants for 22 months the mortgage has now risen to 170,000 euros and the bank have put costs of 51,000 euros for repossessing the property. We stupidly have now lost everything and we are told that the bank will come after us for more money, while my tenants who owe us over 14,000 euros in lost rent and over 2000 euros in unpaid bills get away scot free. The tenants are even trying to purchase the property at auction and trying to stay in the property they have also tried behind our backs to negotiate with the bank which we have found out recently thats why the bank agreed to do the dacion en pago but because we got the eviction the bank cancelled it. Do not ever trust a bank and if possible never have a mortgage because you are never told the true story from the bank and as far as I am concerned the banks have brought this situation on themselves as they over loaned and unfortunately spain will go the same way as greece and portugal and the economy here in spain is not strong enough because of greedy builders and banks and they are now reaping the rewards and taking us with them, so mark my words there are many years of hardship ahead. At least another 5 to 10 years. Regards

Ian H Cox

08-04-2011, 11:52 AM

Any advice, please.
I possess a property and have defaulted on the mortgage.
I went to negotiate with the bank manager when payments were up-to-date and wrote to him to confirm what was about to happen and to receive instructions about what would happen next.
Despite many phone calls to various people at the Bank I have recieved no form of contact.
Can I write to them confirming that I wish them to repossess the property and hand in the keys and deeds stating that I do not wish to retain it and do not want to contest or go through a legal process, increasing the debt.

Unregistered

08-08-2011, 01:04 PM

Dear Sir/Madam,

You would have been served the claim, when you should have objected to this, in principle. Our advice is that you seek legal assistance at the earliest, so an appointed solicitor can investigate the current situation and find evidence that can invalidate the process, particularly that you did actually have money in the account.

It is essential that you can prove that you notifed the bank that they should have charged the pending mortgage amounts through the bank account that was not linked to the mortgage account, where you had the available funds for the mortgage payment thus avoiding the 3-month delay, which is the customary maximum timeframe which the bank will allow a mortgage account to be in the red.

Best Regards,

Many thanks for your reply. We were never served a claim. We did seek legal assistance but our lawyer got nowhere with the bank. He even went to speak with the bank manager but she refused to answer his questions about why the money was held in the bank account and not paid off the mortgage. Every other payment was taken from the bank account as soon as it was paid in. The bank manager told our lawyer she had no reason to speak with him and give an explanation! She told him there would be a court date in April and he should speak directly to the bank's lawyers.

We didn't have anymore money to pay the lawyer to puruse it further and just assumed we'd receive the court date and have to let the bank take the house. Since then we've heard nothing except for when my husband tried talking directly to the bank manager, shortly after she refused to speak to our lawyer. She told him the bank didn't want our house because it was derelict and she knew they wouldn't receive the remaining debt, even if it sold at auction, because my husband was autonomo. We've had nothing from them, or the courts, since - no letters, no beaurofaxes, no phone call, no mortgage statements... nothing.

Is there any chance they didn't actually repossess the house? My husband still receives local townhall bills in his name and we thought they would change to the bank when they took possession. Can we just ask the townhall who now has possession?

Eamonn

08-10-2011, 08:26 PM

Before i begin let me thank you all for this really useful forum and for all the advice you give. Keep up the great work!
I own an appartment in Rojales on the Costa Blanca.When i bought it mine was the in the 3rd of 4 blocks. The builders however decided not to complete the 4th block and errected a scruffy corregated iron fence around the vacant plot, dumped building materials in it and then just left it. Because of this the neighbourhood has gone down, with decent families scrammbling to get out. This has of course meant an accelerating drop in values. I currently have a mortgage of 62,000 euros( the property is now probably worth less than 50,000) Could you please tell me approximately how much i will have to get my mortgage down so that they will accept me handing the keys in and won't be inclind to chase me for the balance. I underdstand that this will be difficult for to answer , but would be really grateful for any approximation

Michelle Cox

08-11-2011, 01:30 AM

Erm, I am in the worst pickle of my life and I just don't know what to do anymore?! I live in Spain and own 2 properties with my ex boyfriend. For the last 2 years nearly, he has not let me have access to either property and has changed the locks. He rents out both properties and pockets the rent. Problem is he does not pay the mortgages with the rent which is how we initially were able to pay the mortgages. Now the banks are reposessing both properties and he will not hand over the keys to me so I can rent out the properties to cover the mortgages, he is happy for them to get reposessed. He knows it takes nearly 2 years for the banks to reposess and knows that he can earn himself a huge income from the rent..............he wants to mess me up financially for splitting up with him! Ludacris, I know, but that's the way it is! We stand to be in debt of about 90,000 euros for both reposessions and obviously I will have to pay half of that back to the banks. He has assured me that he is able to cover his half of the debt with no problems, but he knows I have nothing and that is why he is doing it! Any suggestions as to what I can do? I never thought I would be in this situation, as have never been in debt in my whole life and have always paid my way. It is very distressing!

Toxic Debt

09-20-2011, 03:53 PM

Hi

I'm 5 months behind with my mortgage payments in Tenerife & i cant afford to make them any more. The Bank has emailed me saying I have 7 days to pay the arrears of €2000 or give them the house. The email is worded as this... "You can make a transfer to your account in Banesto and still paying your mortgage or give us your house "

The property value is €136000. I owe €60000 on the mortgage + €2000 arrears & €58 in the red in the bank. There have been a couple sold after 2 years on the market for around the €110000 mark.

My question is this: If I hand the keys back - "Give them my house" as they put it - and they sell at a higher price than what i owe, will i get the balance paid to me or will i forfeit any claim to any profit when i hand the keys back?

If i let repossession take place and they sell for a higher price than what i owe would i get the balance back?

I dont know whether to let it get repossessed or to hand the keys back to the bank.

In hope of advice

Mr Toxic Debt :-(

ANON

09-28-2011, 01:43 AM

If a British citizen owes money on a mortgage, can this debt be passed on to their children , even though they are in the UK, are adults, and have nothing to do with the property?

Marta

09-28-2011, 05:34 PM

Hello Anon,

No, this is not possible. It could only occur in the event that the owner of the property had passed away, the inheritor accepted the will and the inherited goods had a debt. The inheritor would also be inheriting the debt.

Mandy Marbella

10-07-2011, 04:32 PM

Dear Lawbird,

Is there any way at all to take these banks to a tribunal? it seems the people who want to try to keep going by means of interest only or extending the mortgage term - the banks are not interested in helping. My situation is that I have positive equity and I have the feeling the bank does not want to help as they would like to keep the house. I am financially pushed at the moment and have applied to Banesto to have an interest only payment, my present payments are 1/3 interest and 2/3s capital... The bank clerk suggested why didnt I give the house back to the bank? why should I do that, perhaps because there is around €150,000 equity in the house? I would be able to manage very well the interest only... (around €400) rather than €1200.00. But after sending my paperwork they came back to say that my financial position is too weak to REDUCE my payments!!!! Do they understand what they have said? they dont find it too weak to pay the €1200.00!! I wonder really - or there is someone who has an eye on the house? What would or could be the next course of action? any comments would be appreciated.. I am here in Marbella

Anon London

10-08-2011, 09:43 PM

Has anyone on this site had the Spanish banks chase them in the UK, if we are supposed to be part of the European Union why are we not following equal rights and the Spanish banks are so backward.

Anon London

10-12-2011, 12:01 PM

No as per no one can answer my question!!

Patricia

10-14-2011, 10:40 AM

Dear Mr. Toxic Debt,

Please accept my apologies for this late reply.

The best way forward is to come to an agreement with the bank about the mortgage payments. If the bank took the house finally to auction, there is the risk that the amount you get after the sale does not cover the debt you have with the bank and therefore the bank will go against the debtor´s income. If after the auction, the sale price was higher than the debt, the remanent would be for the debtor. You must take into consideration that once in arrears, the debt is increased very quickly as the bank starts to apply a lot of interests on delay. On top of that, there are court costs, so the final amount of the debt can end up being quite high. Also, be aware thart the selling price when a property is sold by auction is far below the market price.
In your case, we believe that the bank would be in advantage if they agreed for a Dacion en Pago, as they can sell the property for about 110.000 Euros in the free market, and as your debt is of 60.000 Euros, they would not be in loss. A good negotiation would be to negotiate with the bank a Dacion en pago asking the bank to compensate with an aditional amount. Another option is that the Dacion en Pago is signed bound to the fact that if the property is sold over the a certain amount ( negotiated with the bank ), the remanent is paid to the debtor.
The bank may be reluctant to go for any of these options, and therefore these are the remaining options:

1. Hand over the house to the bak and lose 50.000 Euros.
2. Continue to be in arrears and let the bank repossess your house, with the consequent sale of the house in public auction. The risk here is related to the amount the bank gets after the sale; if below the debt, the bank can pursue your assets, in Spain and worlwide, until the debt is cleared.

Option 1 sounds as the least detrimental.

Regards,

Chris M

10-29-2011, 08:25 PM

Hi Lawbird I came to Spain 7 years ago and bought a restaurant with an S.L. company three years ago my wife and I took out a credito de polica for 30,000€ with Banco Popular, first guarantor the company second guarantor us personally and since then we have been paying interest only. But this year because of the crisis it looks like we are going to have to quiebra the restaurant. My question is what in your opinion will happen to the debt with credito balear as we owe money to the Seguridad Social and Hacienda and proveedores as well. We have no assets in the UK.

Amanda

11-02-2011, 08:05 PM

Why is everyone getting in a state. Its Spains fault that property is worthless now. Let them say this and that but I have heard nothing about anyone being chased in the UK by Spanish banks its stupid archaic threatning and against every ones humans rights. Take a stand and stop listning to the hype and corrupt housing market!!
.

susan

11-03-2011, 03:31 PM

Could you please advise, my son has a Spanish mortgage which has not been paid for some time he has also remortgaged and the property in Spain has negagtive equity. He received a telephone call from a third party stating that if he signs the property over to them the debt will be cleared, which he has done, although I cannot understand why someone would want to do this considering how much negative equity there is in the property, what type of company could this be?. He has never heard from the bank again. Have you heard of this happening before?

Anon London

11-16-2011, 12:36 AM

Thank you Amanda I feel the same, I will go to the Courts as its all threatning and let them come after me. I was told there is no way I could sell for years so what could I do but walk away. Its their problem and yes and archiac law.

Anon London

11-16-2011, 12:37 AM

Sue

11-22-2011, 01:49 PM

From first contact at the bank, how long would I expect a Dacion en Pago to take?

What happens if I go into arrears during the process? Will it be stopped?

When I first contact the bank, should I ask for something in writing to show that I have asked for the process to take place?

Can a Dacion en Pago be halted in the unlikely event that our finances should improve during the process?

Thanks for any help.

Patricia

11-24-2011, 02:37 PM

Hello Mandy Marbella,

Once a mortgage has been contracted with a bank, you are accepting the terms and conditions initially agreed so if your financial situation changes after some years, you have the right to approach them and try to negotiate the mortgage conditions, however, you cannot force them to agree with your conditions nor are they actually obliged to get to an agreement. Therefore there is no point in taking them to court for that reason.

I recommend you to hire the services of an expert solicitor that can use his knowledge and experience to negotiate the mortgage conditions in your behalf.

We offer that service at Lawbird so please feel free to send us an e-mail through our website´s contact form so we can continue the communications.

Regards,

deborah

01-01-2012, 02:35 PM

I have 4 properties in spain with 4 mortgages with 2 different spanish banks. I am really struggling with payments can i return the keys on 2 of them (one bank) and keep 2 (another bank), the 2 I am wanting to return have negative equity, the other 2 have perhaps a small amount if any equity in them.

southernbelle

01-02-2012, 10:29 PM

we are in the process of requesting a dacion en pago from the bank who themselves suggested this ( the usual long hardship story for us too !) We are now in the UK and owe £30k in CC and loans here and have the paperwork to back it up ( which have been to ironically pay the Spanish mortgage for the last 3 years !) and we rent a house and have no assets . Could you advise whether a lawyer would add weight to our application for this , i.e to present our case of poverty I guess . My in laws have offered to help with lawyers fees but not any repayments , we are not in arrears but probably can pay another 2/3 months max . Thanks , excellent site by the way

Patricia

01-03-2012, 02:18 PM

Hello Deborah,

The only way to find out if your suggestions are possible is to start negotating with the banks. Probably, they will offer to change the mortgage conditions rather that accepting a Dacion en Pago ( handing over the properties in exchange of the debt ). In these cases it is highly recommended to hire the services of an expert solicitor that will liaise with the bank to negotiate new mortagage conditions and reschedule payments or even finally get to an agreement that leads to the Dacion en Pago.

We offer that service at Lawbird, so please feel free to contact us if you wish us to study your particular case.

Regards,

deborah

01-03-2012, 08:09 PM

thank you for your answer Patricia could you give me an idea of cost involved if I were to ask your firm to do this for me.

tenny

01-05-2012, 02:14 AM

Dear Lawbird,

I have a house in spain that we purchased in 3 names. We owe c100 Euros and the property is probably of the same value or +/- 10%. Can I hand the keys back to CajaMurcia? Who would the bank purse in the uk given it is owned by 3 individuals?

Thanks

Tenny

Patricia

01-05-2012, 02:33 PM

Hello Deborah,

Thank you for your interest in our services..

I would very much appreciate if you could drop me an email indicating the names of the banks involved, the amount of equity left and mortgage conditions for each property, so I could offer the most approximate quotation of the costs. Please send me an e-mail on patricia at lawbird dot com.

Best Regards,

big sk

02-08-2012, 08:23 PM

My son bought a property in spain in 2008 together with a friend, due to certain circumstances my son has had to take the mortgage payments on himself (his friend is still on the mortgage) the apartment is standing empty as my son lost his job,. We are travelling to spain on the 19 february as my son got behind with his payments and the bank have said he has to up his monthly payments for the next 5 years in order to clear the arrears, he has been asked to come over and sign the agreement. I believe there could be a notary there and if this is the case have you any idea of the charges for a notary. My son is in massive negative equity (paid 180,00 for apartment and they are now selling for 75000) We would like to hand the keys back but I know he will be liable for the shortfall. He is also behind with service charges and utilities. (my son is now in employment )He wants to try and rent the property out, Im not sure this is going to be the right thing to do as I understand he will have to pay wealth tax? Dont know whether he will actually cover his overheads after taxes,utility charges etc., His mortgage is over 30 years (he is 32) he has no assets in this country, he is renting a property and he also has dependants i.e. partner and new baby. The payments on his spanish mortgage are crippling him. We would like to try and renegotiate the monthly payments on the mortgage or extend the term - can you take a mortgage out for longer than 30 years?. Would we need a lawyer to do this. Help really worried about meeting up with the bank in spain - feel like the lamb going to the slaughter!!

peter williams

02-10-2012, 11:48 AM

Due to a messy divorce.......I have just been forced to declare myself bankrupt in the uk where I reside....I have a place in Spain just in negative equity..... I have NO money!! Advice please re disposal of Spain - handing back keys etc?? Thanks.

Patricia

02-10-2012, 03:27 PM

Dear Mr. Williams,

I recommend you to approach the bank at the earliest and let them know about your new situation, showing them the relevant documentation from UK. Afterwards, you can start negotiating new mortgage conditions or finally get to an agreement with them to hand back your house in exchange fo the debt.

We can offer our assistance at Lawbird, so please feel free to e-mail me on Patricia at Lawbird dot com to get further information.

Regards,

eamonn

02-14-2012, 02:37 PM

Before i begin let me thank you all for this really useful forum and for all the advice you give. Keep up the great work! I own an appartment in Rojales on the Costa Blanca.When i bought it mine was the in the 3rd of 4 blocks. The builders however decided not to complete the 4th block and errected a scruffy corregated iron fence around the vacant plot, dumped building materials in it and then just left it. Because of this the neighbourhood has gone down, with decent families scrammbling to get out. This has of course meant an accelerating drop in values. I currently have a mortgage of 62,000 euros( the property is now probably worth less than 50,000) Could you please tell me approximately how much i will have to get my mortgage down so that they will accept me handing the keys in and won't be inclind to chase me for the balance. I underdstand that this will be difficult for to answer , but would be really grateful for any approximation

Patricia

02-21-2012, 03:20 PM

Hello Eamonn,

Thank you for your compliments, we try to be as much helpful as we can.

Unfortunately, I am unable to provide with an approximate amount; it is very difficult to find it out as each bank follows a different criteria.

Regards,

Malcolm

02-29-2012, 09:12 PM

Once again I have turned to your page for information - it seems to be the only reliable source although I am sure there are others.
My situation is that I own three properties. A house in Orcheta, a bar in Villajoyosa and a storeroom below the bar. There is also a small loan. All properties are on separate mortgages with the BBVA. When things became difficult (lack of money) two and half years ago, I stopped paying the mortgages. I kept the bar open until April 2011 but vacated the house in June 2011. I thought all the properties were in negative equity and received no assistance from BBVA. I have not had any communication from them and their attitude was obstructive. Recently I approached them again and received verbaly from the Bank Manager a figure which indicates we were not in negative equity but if we sold the property then this would clear all outstanding money. I returned to the BBVA branch the next week to confirm that the figures he had given me were correct but found the Bank Manager absent so I spoke to an assistant who gave me a completly different figure. I'm talking €35,000 higher just on the house - why the Bank Manager should give us a low figure I do not know but I have my suspicions. In the preceeding week I had received an offer on the house that would have more than covered the Bank Managers original figure. We have literally a long line of people waiting to buy the bar and store room - so no worries there. I'm sure we will have enough money after the sale(s) to clear the outstanding amounts but are mystified by the BBVA Bank Managers attitude and he does not appear to be an honourable man. (He admits he has his own agenda by having friends willing to purchase the bar and store - at the right price). What I need is someone to guide me through the legal minefield - would your Firm do this and could you give me some idea of the costs involved. I am going to see the BBVA tomorrow to try and get something in writing. Thanks again for your wonderful informative web page.

Patricia

03-02-2012, 11:17 AM

Hello Big Sk,

Please accept my apologies for this late reply, as I believe that you have already visited Spain and that your son may have signed the agreement the bank offered.

In these cases, the best option is to renegotiate the mortgage conditions or try and agree with the bank the Dacion en Pago, that is, that the property is handed back to the bank as payment of the debt thus being your son freed from any future liability in relation to it. However this is only attained if the equity left is small, so renting the property during this period will bring in some cash but it is advisable to inform the tenant, unless it is for short rental.

In your son´s case there is also another person registered in the mortgage deeds, who is also liable for the debt, not only your son, and this fact must also be considered in relation to the new mortgage conditions, as a dissolution of the jointly owned property must take place so that person´s name is removed from the mortgage deeds, though this can only happen if the bank accepts it.

Please feel free to email me on Patricia at Lawbird.com if you wish to receive more detailed information on how to proceed and learn how we can assist.

Best Regards,

Barry

05-31-2012, 03:46 PM

I split up with my girlfriend 3 years ago and we owned a property together in Spain. I have since found out that the house is standing empty. The mortgage has not been paid for the last 3 years, the bank I bought it from the branch has since closed. I have sent various emails and they keep getting bounced back to me. Is there a possibilty I could take the house back on, with a reduced mortgage rate (1500 euros three years ago) or shoud I just cut my losses.

Colin

06-01-2012, 09:45 AM

Please help. My spanish property is in negative equity, so the bank will not accept dacion en pago. I no longer can afford to pay the reduced amount my bank has offered, We do not want the property any more but we can find no buyer, and the bank is demanding money.

We used your firm to buy the property in 2007, and you provided a great service at that time, and I am hoping you can now offer me some advice on what my options might be this time.

Patricia

06-28-2012, 05:19 PM

Hello Colin,

I am afraid that the only option is to contact the bank and start the negotiations of new mortgage conditions that suit you both for a certain amount of time or try again a Dacion en pago, this time with the aid of a solicitor, that is quite convenient as the banks usually consider their legal perspective.

Please feel free to send me an e-mail by clicking on my profile so we can look for your file and study the case.

Regards,

dee

07-18-2012, 03:48 PM

Hi can you give me an idea of the costs involved in a repossession. what can the bank charge me.

Unregistered

08-31-2012, 07:55 PM

My parents purchased a flat in Spain in 2006/2007. They paid a deposit and arranged a mortgage with a Spanish bank but the flat wasn't completely built at the time. They then started to make mortgage payments - I think they may about two payments in 2008 before realising they couldn't pay the mortgage.

They simply posted the keys back to the bank, and emailed the bank. They never heard anything back at all, they still receive the odd letter from the bank giving the balance of an account they had there (nil) and they didn't attempt to contact the bank again - they naively thought they would be clear of everything because they posted the keys back. My father then destroyed all of the paperwork relating to the property - a silly move but's what done is done.

They have heard nothing about the mortgage and now have no records at all about the property, mortgage etc including the fact that they posted the keys back.

Last year, a letter arrived from a debt collector requesting payment of community fees for the flat. My parents replied saying they had returned keys to the bank. Now the debt collector has replied saying that they have checked the land registry, and my parents are still listed as the owners.

They are very confused - does the fact that the bank hasn't contacted them for nearly 4 years mean it has been repossessed? Do you have any advice on steps forward etc? They are elderly and my mother is in bad health, and they don't have the funds to pay for legal advice. Neither of them work and they have paid off the mortgage on their UK house.

Could the debt collector or the Spanish bank come after their UK property at some point?

Thank you!

magel

09-07-2012, 04:57 PM

Can you adivse please.We are undergoing proceedings to have our property repossessed, we had been managing to pay a certain amount of the mortgage but early this year the bank sent burofax to advise re the debt The bank would not make any arrangements to re negotiate our mortgage unless we paid the arrears & costs amounting to 10.000€, if we had that kind of money we would not be in this situation. We had a lawyer try to work things out with the bank but they flatly refused to help. He advised us to stop paying anything as the bank had started re possesion So far all we have had is some papers from the court: procedimiento: Ejecucion hipotecaria

we accept we are going to lose the house as it is only worth about a third of what we owe. We can't seem to find out where we are in the process, do the bank or court have to inform us when it has gone to auction and when we no longer own the property or will someone just turn up to evict us, are we given notice to leave. Would apprciate any advice.

Phil

09-10-2012, 12:16 PM

We have a property in Lanzarote that is in negative equity. 2 years ago we negotiated a payment with the bank where they put a second mortgage on the property - this has now increased our negative equity to £100,000.
We are able to offer the bank about 2.5% interest on the loan with no capital repayments. We have no other assets in Spain or in the UK and so if they do repossess they can only come after future money.
What should we do? Repossess or try and negotiate again (although last time this increased our debt by £20,000 over 2 years!).

Patricia

09-14-2012, 11:41 AM

Hello Magel,

As you have already been notified of the process ( procedimiento: Ejecucion Hipotecaria ), the details of the particular courts of justice and process reference number appear on it so you are free to attend the process if you wish by means of legal representation in order to be informed of all the steps that are being taken, though this will have a cost which may not be worth paying.

Some court officers allow for a few days notice before the eviction takes place, but there is no way to guarantee this in your particular case. Our advice is that you stop paying, as your lawyer already advised you, and be alert for court notifications.

Regards,

Sally M

09-20-2012, 03:11 PM

My boyfriend and I bought a house in Spain in 2005 and moved over in 2010. We have had no problems paying the mortgage until this year. We were in arrears ealier this year but managed to pay it off. However we have been unable to pay the mortgage for the past 3 months. We have had no communication from the bank at all and we have not had any letters from them. We have now received a Cedula de Citacion and have to appear in court. We don´t know what they are going to do? Are we going to be repossessed or do we have time to pay off the arrears, as we have heard nothing from them? What are our options as we want to keep the house and can now pay the mortgage payments? If we are too late? What happens now? We have kids will they give us time before we are evicted?

Patricia

10-08-2012, 10:41 AM

Hello Sally,

I recommend you to contact the bank and ask them to stop the proceedings as you are now able to make payment of the arrears, however, you will have to pay the full pending amunt upfront including the legal costs they have incured. A repossession process is not that quick, so you are in time to solve the situation.

It is highly recommended to get the legal assitance of a solicitor to negotiate new conditions with the bank and, even more, stop the legal process they have started, not only due to the language barrier but also for the confidence it gives them that you are sincere in your proposals.

If you wish to discuss your case by email, please contact me by clicking on my profile.

Regards,

canadagoosefemme

10-19-2012, 06:45 AM

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<a href="http://www.canadagoosefemme.org" title="canadagoosefemme">canadagoosefemme</a>

G.McA

10-29-2012, 01:46 AM

hi, I have just found this forum and it gives some very useful info.
My problem seems similar to many others on here, in that we want to get out of our property in Spain but very likely have negative equity - at the same time, we also want to be sure that our UK assets are secure.
We purchased an apt in Murcia in 2008 with valuation approx €180K, paying approx €40K cash and €140K mortgage with Bancaja (now Bankia) - what are the possibilities to hand the keys back in a controlled manner ?
I have just last week kicked off some initial discussions with the local branch rep on this but she seems (understandably) to not be very interested or helpful, only saying it is very unlikely to be agreed and asking for copies of my P60's, monthly bank accounts, etc as evidence that we cannot pay the mortgage.
Some of the replies on here suggest that some banks may be open to negotiations as obviously it is better for them not to have legal & repossession, etc costs as well, but I toitally understand that they would ideally not want to have the property back on their books.
What if my property was now valued at €100K (not sure if that is reasonable but take it as an example) --> would the bank consider taking the property as full and final settlement. or perhaps I could scrape up say 10 - €20K cash to add to the settlement - are the banks (and Bankia in particular) , amenable to this type of negotiation ? We basically want to get rid of the apt as it is pulling us down and not allowing us to get on with our lives (we cannot sell it or rent it at the moment, our agent has tried hard to do so we think ) - we would really appreciate your advice and guidance on the best way to proceed here.

Thanks

james brown

11-11-2012, 09:55 PM

i have an apartment in the costa del sol and the locks have been changed. i received a letter dated the 22nd october in the uk which arrived on the 7th november 12. I am unable to translate fully but it states i have 15 days. Is this legal for the bank to do this should i have received some paperwork in advance and how can i get my clothes and furniture out of the apartment as they are all i have. Can i break the locks to gain entry.

Unregistered

11-12-2012, 01:30 AM

[...]
My problem seems similar to many others on here, in that we want to get out of our property in Spain but very likely have negative equity - at the same time, we also want to be sure that our UK assets are secure. [...]

Keep pestering your bank . After 18 months we finally were granted a dacion. We stopped paying the mortgage, provided all the evidence to show we could not afford it and the property was in negative equity. A burofax requesting the dacion was sent through a lawyer. Persevere !

Mrs L

11-28-2012, 08:17 PM

Hello, i'm after some advice! 2 years ago i took out a Mortgage for 250k to purchase our first home on the costa del sol. We have recently been struggling to meet the repayments, we went to speak to the bank to see if we could go on interest only, they refused. We asked for any advice/help that they could give us, they didn't offer anything. We are now in arrears. Again, we spoke to the bank, asking for interest only until we got back on our feet, or any help that they could give us. They won't help in any way. I am now in a better position financially and i can now only just make the monthly repayments, but i can't find the money to resolve the outstanding arrears. When i took out the mortgage they put extra on it to cover an insurance, im not exactly sure what this insurance covers, but the repayment is in with the mortgage repayment. My husband also has a personal pension with that bank which holds funds in that, could the insurance and pension be used to pay off the arrears? I've had no letters or phone calls about repossession or any action. I've not even had letters to say i've gone into arrears. If i was to commence with making the monthly repayments, could i still lose my home due to the arrears? Also i have 2 young children, would they evict us and leave us homeless?

Stung-by-communityfees

12-10-2012, 11:40 PM

I handed my property back to the bank and they have subsequently sold it, I am now being chased for the community fees even though I went bankrupt and included the properties in my uk bankruptcy, community fees have now got a judgement against me and bailiffs have been paid, I understand the bank are responsible for discharging the fees prior to sale? These seem like fly by knights and have made my life a nightmare surely my debts went in the bankruptcy

theresa

12-18-2012, 04:55 PM

My situation is this, i brought a hosue in spain 2005, we are behind in the morgage and have now found a buyer which is under the morgage value paper work has already gone in for a dacion de pago.. The banks have agreed to the sale in principle and to wipe the remainder of the debt clean. I have told the agent that the buyers have to pay all notari fees etc.I still owe aprox 700 for the ibi which i cannot pay as i dont have the money However I have just been informed by some one that I will have to pay Hacienda. Will i have to pay this as i am making a large loss and no profit what so ever. Are there any other fees that i should be aware of that i have not been told about and is there anything i can do about the ibi as i know this can stop the sale.
desperate for the right advise.
regards

Patricia

12-19-2012, 03:49 PM

Hello Stung-By-CommunityFees,

I understand the debt you are being claimed corresponds to Community fees you had pending of payment for your property in Spain. It is in all probability that the Spanish authorities are unaware of the fact you have been declared bankrupt in the UK, therefore a court process was started by the Community of Owners to recover the debt.

In Spain, whoever bought the auctioned property is liable for the debts it has, so the new property owner would now have to deal with the matter. I recommend you to ask the Bankruptcy Administrator in the UK to contact the Spanish courts dealing with that claim to let them know the debtor has been declared bankrupt.

Regards,

Karen6498

01-22-2013, 04:23 AM

I have recently obtained a divorce in the uk. My ex husband and I
jointly own a property in Spain. I at first purchased the property off plan
with someone else. I put down approx ?40k then later later date my ex husband
was put on the deeds. He continues to pay all fees for property(mortgage and
community fees). I pay ?100 towards this as I have othe financial
commitments ie uk mortgage. My ex is currently refusing to sell the property
(very little or no equity in it/ negative equity) he refuses to provide any mortgage details
or copies of deed, refuses me access to property though he frequently uses
it I have offered to sign property over to him again he refuses. What is the likelihood of me handing back my share or property to the bank ? Any other suggestions
I am sole provider for my children( not of the marriage) and as a result of the debt he left me in I doubt I can afford a solicitor but any help would be appreciated

Patricia

02-07-2013, 05:10 PM

Unregistered

03-22-2013, 04:11 AM

Hello Karen,

The bank will not accept partially taking a property.

Your ex-husband has not got any right to block your access to the property as you are the co-owner, so reporting the case to the authorities would help in that regard, if youa re able to produce a copy of the deeds that confirm it. Also, if your husband refuses to let you have a copy of the deeds, please be aware that you can get a copy yourself, by asking the Notary or the Bank where the mortgage is secured, to give it to you.

Please let me know if the divorce processed in the UK established anything concerning the Spanish property and I will be able to advice further.

Regards,
No, it was not dealt with in the divorce as my ex refused to even discuss getting rid of property. I've told him he can have my half but he refuses to take me off mortgage. He uses property and now takes his girlfriend there. He tells me it is his intention to rent it out and if I want to go I must pay rent