MORTGAGE COSTS. CLAIM YOUR RIGHTS!
EXCELLENT NEWS FOR CONSUMERS:
THE EUROPEAN COURT OF JUSTICE FORCES SPANISH BANKS TO REFUND ALL ABUSIVE MORTGAGE COSTS IN FULL. REMEMBER: NOW IS THE TIME TO REVIEW YOUR MORTGAGE AND CLAIM WHAT IS YOURS!
The Court of Justice of the European Union -CJEU- has declared in a judgment handed down on July 16; that if the abusive clause that charges the client with the payment of all the expenses of the constitution; and cancellation of a mortgage is declared null and void; the bank must proceed to the full refund of the amounts unduly paid by the consumer.
What does exactly the CJEU Judgment say?
According to analysts, this new ruling of the CJEU; would allow about 8 million clients to claim and recover all the expenses of setting up the mortgage; (Notary, Property Registry and Management & gestor) provided that a judge declares the nullity of the mortgage clause.
The above-mentioned Judgment has come to answer the preliminary ruling that had been raised, both by the Court of First Instance No. 17 of Palma de Mallorca and by the Court of First Instance and Instruction of Ceuta; which has been a new setback to the jurisprudence of our Supreme Court in this matter; which unfairly ruled that the notary and gestor’s fees derived from the mortgage loan, should be divided 50% each.
However, the CJEU has indicated that this distribution of expenses; would only be admissible in the unlikely event that the provisions of national law applicable in the absence of the clause declared void; might precisely impose on the consumer, the payment of all or part of these mortgage costs; which in practice it never happens.
Thus, it is considered contrary to Union law, – specifically to Directive 93/13; – that the national court can modify the content of a clause declared abusive, and as a consequence, once declared its nullity; the bank will have to reimburse all of the expenses and not just 50%
Opening commission of the Mortgage
Likewise, in relation to the opening commission, the CJEU has again corrected the Supreme Court; leaving open the possibility for the consumer to claim their amount as well.
Therefore, unlike what the Supreme Court pointed out, it is not sufficient that the opening commission appears in the mortgage contract to consider it valid. On the contrary, the clause must have a “clear and understandable wording”, which cannot be reduced to a merely formal or grammatical level; Rather, this requirement must be understood in an extensive manner; given the comprehensive consumer protection that Directive 93/13 grants to the consumer, who is always in a situation of inferiority.
That is, the clause must transparently explain the specific purpose and mechanism of the opening commission clause within the contract; so that the consumer is fully aware of the reasons that justify the fees corresponding to this commission.
Limitation period and the deadline to claim the refund of these amounts
The CJEU has been favourable to the application of the five-year limitation period with regard to the refund of the amounts unduly paid; However, it has declared that the five-year period begins to run from the conclusion of the mortgage loan contract; and not when the mortgage was granted.
Procedural aspects and costs
Finally, the CJEU has resolved in relation to the attribution of the costs; that if the consumer is finally forced to go to the Courts to obtain the declaration of nullity of the abusive clauses; due to the refusal of the bank to reach an out of court settlement; full costs will be imposed on the bank.
This is excellent news because until now, the court had the discretion not to impose costs on any of the parties; which in practice was a deterrent for many consumers to exercise their rights conferred on them by Directive 93/13, and obtain an effective redress.
100% RATE OF SUCCESS SO FAR
The good news is that we are winning all the Court cases against banks, and we are currently preparing new lawsuits on behalf of an increasing number of foreign people affected; so we are very confident about their outcome as well. Remember, that even if you might be national from another country, you have granted with the same rights as a Spanish consumer!
Likewise, the bank will still face liability, even if the mortgage might have been already cancelled within the limitation period of the action.
HOW TO CONTACT US FOR FURTHER SPECIFIC ADVICE?
We hope this information is useful. Remember that this article is not intended to be specific legal advice, just a general overview. Should you be interested in receiving more specific information; (either about this particular mortgage subject or any other matter), you can contact our firm in several ways:
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Finally, thank you very much for your attention, and in case you might have any question or doubt at all about how to claim your mortgage costs, again please do not hesitate to contact us. We will be glad to help you!
We look forward to helping you and the benefit of our “know-how”.
Mr Oscar Ricor
“NON-PRACTISING ENGLISH SOLICITOR IN ENGLAND AND WALES”, under the “Solicitors Regulation Authority” (SRA) SRA number 519196 and practising Spanish Solicitor.