The mortgages contain what is known as a ‘clausula suelo’ which fixes the minimum mortgage payment. Therefore, the product is still a variable rate mortgage but the Bank sets a cut-off point below which your mortgage repayments will not fall.
Most of the 4 million mortgages estimated to be effected by this ruling were sold during the 1997-2007 property boom when buyers were paying over the top prices for property throughout Spain.
Whilst the ‘clausula suelo’ type of mortgage is not outlawed, the court has said the existing mortgages sold are null because of a lack of transparency on the part of the Banks, which failed to adequately inform clients what they were signing up to.
Only 15,000 homeowners who were part of the class action which took this matter to court are aware of this ruling and this leaves upwards of 3.75 million people who could benefit from this ruling, including overseas borrowers.
If you require legal advice to see if you fit the criteria of a ‘clausula suelo’ mortgage, then please call EU Property Solutions today on +44 (0) 330 124 1230. We can arrange our team in Spain to work alongside a legal associate to review if you indeed can benefit from this court ruling.
We look forward to assisting you!