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El blog de Maria

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

Legal tip 487. Limits on interest rate of mortgage repayments
05 April 2011 @ 09:45

Interesting article at El Economista today: A frequently ignored problem in repossessions is the excessive delay interests. Two good solutions:



1) To legally limit the rate of delay interests: This would not be a foreign measure to our legal order as Law 7/1995 on Credit for Consume and Cheque and Exchange instruments Act of 1985 establish limits to delay interests. This last one set legal interests +2. According to El Economista, this would be a good reference. We agree



 2)To legally limit the amount and mortgage installments which have delay interests attached.  This other measure is not foreign either. Provision 693.3 of the Civil Procedure Act allows the debtor to save the asset that is going to be repossessed, if this is the habitual dwelling, by paying those installments whicg are due at the moment of bringing the Lawsuit to Court and therefore limiting delay interests to these instaments´amounts. This measure would reduce between 20 and 30 percent the amounts being claimed.



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