The repossession process
When a borrower misses several payments, Spanish lenders will begin repossession proceedings. The bank will write to you to inform you of the proceedings, but this letter will typically be delivered to your Spanish address, meaning you might not even know this is happening.
Bank repossessions in Spain take time and vary from lender to lender. When complete, They will sell your property to fulfil your mortgage obligations, and this is where the problem will arise as, in most cases, they will sell it below the mortgage value to get as much back as possible. Â In return, this leaves you, the owner, with a shortfall to pay.
After repossession
Now that the process is complete, you will immediately become responsible for paying the shortfall that is left. In most cases, this will be much larger than expected, as lenders in Spain will add interest, legal costs and any outstanding community fees. Spanish banks will demand the full payment, and failure to pay will result in them pursuing you in Spain & your own country.
It is relatively common for lenders and banks to just write to your Spanish address. So, many people don’t even know their property has been repossessed until payment is demanded. Regardless, if you haven’t paid your mortgage, you will still be liable, so it makes little difference if you did not know.
Unfortunately, the answer is yes. No matter where you live, your lender will chase you for the money owed. Spanish banks are extremely persistent and employ a variety of pursual techniques.
This can include appointing local solicitors, securing judgements on you, and repossessing your property and assets in your home country. Read more about these recovery techniques.
Alternatively, they can sell your loan to a Vulture Fund. This is the worst-case scenario, as these large international funds are ruthless and efficient at recovering debt. Read more about Vulture Funds.
If your property is repossessed, it is more likely that the debt will be sold to a vulture fund or passed to a collection agency. This is more or less the worst-case scenario as these funds are more aggressive and more willing to put in the time and effort to recover the money that is owed.
For over a decade, we have been helping people in exactly the same situation you find yourself in. We understand that you have probably been lied to by the bank, developers, and estate agents. If our amazing results don’t say enough for themselves, check out some of our testimonials or, call our office and speak to a member of the team. You can even chat with previous clients of ours over the phone!
Ideally, you would need to act before your property has been repossessed, as this can make it easier to reach an agreement with the lender.
If this isn’t the case and your property has already been repossessed, EU Property Solutions is on hand to ensure you have the best outcome. Our UK-based team have been working alongside our Spanish legal representatives for over a decade to ensure each of our clients gets the best deals possible.
Act today by calling our team on 0330 124 1230 or email us at hello@eupropertysolutions for a free case review and see if you are eligible for our no-win no-fee package.
