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El blog de Maria

Your daily Spanish Law reporter. Have it with a cafe con leche. www.costaluzlawyers.es

Legal tip 27: Keys back to the Bank: a right.
15 January 2009 @ 15:51

Dación en pago ( dation in payment) is not something that you  will luckily and graciously obtain by the "wonderful mercy of the Bank"  BUT A RIGHT, out of provisions 1175 et seq of our Civil Code:

Article 1175.

The debtor is entitled to transfer their assets to creditors in payment of its debts. This dation, unless otherwise agreed,  will only  release him from liability for the  liquid amount of  the value of  transfered assets. Any agreement on the effect of these dations  concluded between the debtor and its creditors will be done according to provisions of Title XVII of this book,  and according to what is stated in the Code of Civil Procedure.

The offer of payment and the assignemt for collection

Article 1176.

If the creditor to whom the offer was made  refuses to admit it with no reason given, the debtor will be free of responsibility by the assignment of the good.

(...)

Article 1177.

For the assignment of the good to be effective, the debtor must  firstly announce it to those people interested in the obligation.

The assignment will be uneffective if it does not strictly conform  to the rules governing the payment.

Article 1178.

The appropriation will be made by depositing the goods before the judicial authority, to whom the offer will be credited in some cases, and /or the announcement of the assignment in others.  Once the assignment is made, it will have to be announced to interested parties.
 
Article 1179.

The costs of the assignment ,  where appropriate, will be paid by  the creditor.

Article 1180.

 Once the assignment has been duly made, the debtor may request the court  to cancel the obligation.

While the creditor has not accepted the assignemt or the approval of the Judge has not been made,the debtor may withdraw the assigned good or amount,  leaving the  obliagtion remaining.

Article 1181.

Once the assignment is made and the creditor allows  the debtor to withdraw the good or amount,  the debtor will lose any preference on the good. The co-debtors and guarantoors will also be  free of debt.
 
 
 By Maria L. de Castro

web@costaluzlawyers.es

www.costaluzlawyers.es

Castellar ( Cádiz)  reservoir. By Luis Lopez-Cortijo



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12 Comments


Paul said:
27 April 2009 @ 19:47

I found this page useful and have used it to hand back a property I have in Spain.

Its taken the bank a while, but they have finally come back and are now attempting to pressure me to sign quickly.

As its going to be tough for me to get to Spain (financial pressure and also work time) I have offered to sign documents, witnessed by my UK bank and a solicitor here but they want me to pay €500 + VAT for a solicitor to do the paperwork via a power of attorney.

I was just wondering if, under article 1179, the bank should be paying to do this?

If I could actually afford €500, I would fly out myself and have a long weekend break at the same time and still have change left over!

Do you have any thoughts you may care to share with me.

Thanks

Paul


Maria said:
28 April 2009 @ 08:15

Wonderful you managed to give keys back to the Bank.
Initially a revision by a lawyer and a proxy to sign on your behald the dation in payment is unavoidable and highly advise as it is important that you rights are protected ( as in any other transaction, specially abroad).
I just can suggest you to try and see is you can find a cheaper offer.


Maria said:
28 April 2009 @ 08:15

Wonderful you managed to give keys back to the Bank.
Initially a revision by a lawyer and a proxy to sign on your behald the dation in payment is unavoidable and highly advise as it is important that you rights are protected ( as in any other transaction, specially abroad).
I just can suggest you to try and see is you can find a cheaper offer.


Paul said:
28 April 2009 @ 09:12

Thanks Maria,

I will bite the bullet and pay the fees as necessary.

Appreciate you answering

Regards

Paul


Maria said:
28 April 2009 @ 10:22

Chech that the representative you are paying for is independent from the Bank. Very importantly.

Best regards,

Maria


Robin said:
26 June 2009 @ 08:03

Hola Maria

Como estas?

Mira, tengo un problem con el banco. Estoy intentado hacer un dacion en pago por la hiptoteca/prestamo. Ellos debo 5000 euros atratados y el banco han hecho un neuvo tascacion pero ahora ellos renunciar el dacion en pago porque el valor de mi piso es minus el valor de tasacion en esto mercado! Not a surprise in La crisis!! Puedo usar Clausa 1175 del Codigo Civil quando el valor del NEUVO tasacion es menus el deuda? Soy ingles pero vivo aqui desde haces 6 años. Tengo un buen abogado en madrid pero aprecio sus consejos. Un saludo Robin


Andrew McCulley said:
02 December 2010 @ 00:57

I am 50,000euros in arears with my bank uci.
i have agreed a repayment plan and currently paying 1700euros per month interest only.
i want to hand back the keys but am worried they will go after my uk assets.

can you give me any tips?

i am willing to write of any monies paid so far.

i am up to date with community fees etc.


Maria said:
02 December 2010 @ 08:36

Use a lawyer and send a proper and formal offer for the house to be taken as payment of the debt.


Caroline said:
23 March 2011 @ 14:44

Having read this, I am now confused, we tried to do a Dacion for Caja Madrid and they refused it. I think now we should have pushed harder. We only have the emails from the bank to prove it.


jade said:
06 May 2011 @ 16:58

spanish lawyers are thiefs they should be hanged up,,


Catherine said:
12 September 2011 @ 15:14

I have a property near murcia and a mortgage with la caixa for approx 210,000 euros which is 100% of the purchase price, i have had the property for 5 years or so now and am struggling to pay for it now, the site it is on is now longer building and the state of the site is not as it was projected to be 5 years down the line so rentals are still very few and far between, i have been to the bank to see if we can remain on an interest only basis for another couple of years but am not sure if this will be granted, if not my only choice is to try to give the keys back but the property is worth less now than 150,000 euros, i have little or no assets in the UK and especially nothing like the 60,000 difference, what should I do know ??


Maria said:
12 September 2011 @ 16:10

Dear Catherine:
Please send an email to me to web@costaluzlawyers.es so I can send to you full advise.
Kindest regards,
Maria


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