Our clients came to us for help as they owned a 2-bedroom apartment in the Roda Gold Resort that they had purchased 15 years ago. The property was valued at €125,000 however, the outstanding interest-only mortgage was €190,000.

The property was costing €1,200 in mortgage repayments per month plus community fees and IBI taxes.

The payment per month had increased as a consequence of their interest-only term ending after ten years. The increase in payments meant retaining the property was simply unsustainable as they were retired and living off their pensions.

What was at risk?

• The couple’s UK home would have been on the line if they had stopped paying the mortgage.
• They both had sizable NHS pensions that could be at risk.
• They were faced with a choice between not paying the mortgage and risking their assets or, falling into debt to maintain payments on a property they no longer wanted.

What we did

• We negotiated the surrender of the property to the Bank and a complete debt write-off (the entire €190,000).
• The couple ceased payments, saving c€1,200 per month for the duration of the process.
• Our client avoided expensive sales costs in Spain.
• 3 months’ IBI taxes were included in the settlement.
• The couple’s UK assets and pensions were protected.

This particular interest-only case was a challenge for the legal team in Spain as the client initially utilised the services of another firm. They subsequently failed to deliver on their promises and actually made their situation worse. This is a common theme with Spanish legal Firms, unfortunately.

The clients were amazed that we managed to get this amazing settlement for them so quickly where they had previously failed.