Mortgage base clause


24 Jan. 2017

The European Court of Justice in its Judgment dated 21st of December has ruled that Banks affected by the nullity of the “base clause” (a practice establishing a minimum interest rate so-called mortgage floors or “clausula suelo” in Spanish, even though the legal interest in force may be lower, that has been declared abusive by the courts) have the obligation to return the inappropriate interest charged as from the date of signing the mortgage (retroactively).

Last Friday 20th of January, the Government approved Royal Decree Law 1/2017 establishing a free extrajudicial negotiation mechanism where banks have the obligation to inform their clients within the maximum period of 3 months upon their request, and make an offer that the client has to evaluate and agree or disagree in a 15 days period.

If the Bank considers that a client does not have the right to refund, or should the client considers that the offer made is not right, a judicial claim may be started. If the bank loses the case, it will have to pay the litigation costs.

Those who have already paid out their mortgages have also the right to claim.

The bank will not contact you. You may need professional assistance to negotiate with the bank, to evaluate their offer, to consider the alternatives. JC&A Abogados can act as your mediator. Contact us for further details.

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