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EU Property Solutions- Experts in all Spanish property issues

EU Property Solutions offer professional assistance and advice in all areas of European property in particular, Spain. We can help provide strategies and solutions to solve problematic property issues, negotiate with lenders on debts, help reclaim lost deposits on unfinished developments and help with repossessions and mortgage arrears across Europe. We have offices in London, Belfast and Spain.

Divorce & Overseas Debt
12 April 2019

EU Property Solutions have assisted borrowers in the past who are divorced or separated to settle their overseas debt in an amicable fashion. We understand it is a difficult and emotional time for all involved, nonetheless civility and working together can bring excellent results.

The problem

A common occurrence in these types of cases is that during the divorce, one party was to take control of the overseas property, with the other individual waiving their rights to it. However, if the correct processes are not undertaken in the country where the property is located, then it is likely both parties will still be named on the mortgage. Therefore, both parties are joint and severally liable for the debt.

How can EU Property Solutions help?

Given the above, EU Property Solutions require authorisation to act on behalf of both parties named on the mortgage. With the overseas debt being joint and several it is essential to understand the ramifications for all parties involved and that actions taken by one individual affects the other party.

EU Property Solutions will be impartial throughout. We have one goal, which is to minimise your overseas property debt exposure. As clients, although circumstances may be difficult, we urge you to both seek amicable solutions.

What can you do?

If as a divorced/separated couple you are willing to work amicably then EU Property Solutions can finalise your overseas property debt. It is important to see the bigger picture in these types of cases. This property could be the last thing tying an estranged couple together, therefore offloading it and finalising the debt can bring closure.

Therefore, if as a divorced/separated couple you are willing to work amicably then EU Property Solutions can finalise your overseas property debt. It is important to see the bigger picture in these types of cases. This property could be the last thing tying an estranged couple together, therefore offloading the property and finalising the debt can bring closure.

Contact us

As with all our cases, we require relevant documentation and full transparency of current financial circumstances to quote and to proceed forward with the case with confidence.

Should you have a European Property Debt owed jointly with a former partner and wish to know your options, please call EU Property Solutions today on +44 (0) 330 124 1230.

Read some of our case studies here or check out our brochure here.



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5 Top Tips for Renting Your Holiday Home
15 March 2019

Due to busy home and work schedules, the time spent at your holiday home tends to be shorter than you’d like.

Whether it’s in sunny Spain or picturesque Portugal, having a holiday home is a great way to feel comfortable while you’re abroad and do things the way that you like without the restrictions of hotels. Most people only spend a few weeks a year at their holiday home if they are lucky, so if you want to make the most out of the investment, have you considered renting it out when you aren’t staying there?

Here are our top tips if you decide to do so:

1. Let the taxman know

As is the case with most things, letting out your holiday home is going to come with tax implications. If your rental income is more than £2,500, you need to report this on your self-assessment tax return. However, if you decide to let your holiday home for the majority of the year then you could qualify for several tax reliefs, such as accounting fees and insurance. Bear in mind that these could change in the near future when Brexit comes into play.

2. Stay in the house yourself at least once a year

This one probably goes without saying for most holiday home owners as they want to make the most of their purchase, but staying in the house will highlight any issues such as low water pressure, missing kitchen utensils or any small improvements that could be made.

3. Give your guests a memorable stay 

Think about great hotel or holiday home experiences you have had and keep this in mind when preparing to let out your home. Comfortable beds and good quality bedding are usually number one on the list of desirable qualities. Invest a little more in these if you are able, as an uncomfortable bed can really dampen a holiday. Similarly, lack of or slow WiFi can be a great annoyance to guests, especially if your home is in a more rural area. Additionally, small touches like a bottle of wine or a list of your favourite local restaurants can leave a great impression and encourage people to leave good reviews about their stay.

4. Leave your property in trustworthy hands

If you don’t live in the same country your property is located in, then it is important to have someone trustworthy to manage it. There are many companies that will do this for you, just be sure to do your research first. Finding the right people will ensure that managing the property won’t cause a headache for you.

5. Effectively market your property

With websites such as AirBnB, renting your property has never been easier. Make sure to take good quality, inviting photos of your home as this is the first thing potential guests will judge your listing on. Enlist the help of a professional photographer if you don’t think your skills are up to scratch as this could make or break a booking. The review section is another critical factor that potential guests will take into consideration, so encourage happy guests to leave them and reduce any factors that could prompt a complaint.

In conclusion, enjoy your home, take note of these tips and enjoy a profit from it while you’re not using it!



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Are Bankia and Banco Sabadell about to sell your mortgage?
25 January 2019

Spanish banks have been making major moves lately to offload their non-performing loan books. This means 2019 will be a busy year for property debt collectors! If you have a Spanish mortgage, chances are you could be affected.

Just before Christmas, Bankia announced that it has agreed the sale of €3.07bn in bad real estate assets to private equity firm Lone Star. The deal will close later in the year.

Similarly, Banco Sabadell have also agreed to sell 80% of its property platform Solvia to a subsidiary of Intrum Group, one of the world’s leading debt collection companies.

What does this mean for your Spanish mortgage?

When a company buys up bad debts, they want to recover the money as quickly as possible. This could mean legal action as they typically take an aggressive approach towards recouping debt. They can also chase the debt back in the UK. However, this is actually good news for you as it means they are likely to settle the debt for a much lower amount. If you have a Spanish mortgage and are notified that your loan will be sold, now is the time to act.

What can you do?

For most of us a new year means a new start and January is the perfect time to take a look at your situation and come up with a plan to tackle your debt. Here are our top tips for approaching it:

 1. Set realistic goals

When people set New Year’s resolutions, often they are overly ambitious and give themselves goals that are unachievable. All this will do is make you feel negative and like you have failed when you are unable to achieve them. To avoid this, be sure to look at your financial situation thoroughly and give yourself small goals that you know you’ll be able to achieve. There’s no point in trying to pay back too much as this may even result in you getting into more debt.

2. Keep on top of your finances

One of the best ways to manage your finances is to keep track of all of your incomings and outgoings. Do this by writing everything down in a book and checking it daily. This will help you to understand your behaviour when it comes to money and will assist you when it comes to paying off property debt.

3. Seek professional help

Sometimes you need the help of someone that really knows what they are talking about when it comes to debt. This can help relieve the stress and emotional weight of your situation. Seeking advice from professionals who deal with these issues every day could be your best bet of resolving your debt.



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The Decline of Polaris World and Costa Blanca Golf Resorts
13 December 2018

The Costa Blanca has long been a popular hotspot for many people wanting to buy their dream holiday home. Over the years many have followed their dream purchasing either investment properties or as holiday homes for retirement futures.

During the Spanish property boom pre-2008, many people purchased properties in this region. Our focus this week has turned to the notorious Polaris World Golf Resorts.

They were once Europe’s most ambitious holiday home developer and consisted of numerous large-scale projects. These resorts were widely advertised on the television in the UK by legendary golfer Jack Nicklaus (the designer) to entice investors looking for a better life in the sun.

During this period, properties were sold at highly inflated prices. Some apartments going for €200,000 (£160,000). Thousands of foreign investors flocked to purchase at these resorts. However, when the financial crisis hit in 2008, the prices of these apartments declined rapidly. Despite the slump in the property market, Polaris World continued to build and ignored the warning signs.

By 2010, they were forced to relinquish most of their assets, including the golf courses and unsold properties, to the lender. These once popular resorts are now best described as ghost villages.

In 2018 some apartments are struggling to sell for €60,000 leaving many in negative equity with unaffordable mortgage payments to meet.

Do you own a property in the Costa Blanca?

Do you know someone going through a similar situation?

Are you struggling to pay your mortgage?

Are you having trouble selling your property due to Negative Equity?

There are solutions! EU Property Solutions specialise in these kinds of cases every day.

Our experienced team can offer tailored advice and solutions to end your nightmare forever.

EU Property Solutions have a legal team in Spain that work effectively with borrowers to offload the negative asset and secure a significant debt write down, often saving hundreds of thousands of euros for clients. Our dedicated team will keep you informed every step of the way.

Other well-known Golf resorts on the Costa Blanca such as Roda Golf, United Golf, Peraleja Golf and Corvera Golf & Country Club have now found that they are in the same predicament and are essentially mortgage prisoners with nowhere to turn.

Our success is proven

EU Property Solutions recently worked with a client who had purchased a holiday home in Peraleja Golf, Murcia, Spain. Due to the property crash, our client’s property value plummeted from €300,000.00 to a forced sale price of €140,000. The outstanding mortgage at the time when the clients approached us was €257,000.

As the clients were pensioners, they were unable to maintain the high mortgage repayments and the property was no longer worth the sum they had paid for it.  The property had been placed on the market for 5 months at €200,000 and this had generated zero interest due to the development itself falling into a state of disrepair and the linked golf course closing indefinitely.

To make matters worse, the couple had a mortgage-free property in the UK with significant equity, in addition to other assets including ISAs and bonds, so were understandably worried about the repercussions of this problem property on their assets in the UK.

After providing specialist assistance, EU Property Solutions negotiated the voluntary surrender of the property along with a complete debt write off. This was an excellent result and has allowed the couple to move forward with their lives and enjoy their retirements.

If you find yourself in this situation, contact us today on 0330 124 1230 and one of our specialised agents would be happy to assess your circumstances. For further information, click here to visit our website. We can help!



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MORTGAGE GREATER THAN VALUE IN SPAIN – WHAT ARE THE REALISTIC OPTIONS?
24 October 2018

Following the 2008 Global Financial Crisis the Spanish Property Market suffered a drastic decline, and in some instances, property values halved.

This article summarises the current circumstances and trends and the options available to those suffering Negative Equity.

We have observed an improvement in property price trends over the last 12 months. Whilst this is positive, it is key to remember the rises are small and of a small value. It will take a significant time period for prices to ever recover to the peaks of 2007. Accordingly, many investors still deem themselves ‘mortgage prisoners’, feeling trapped by the burden of Negative Equity and unable to free themselves of the property.

Another reoccurring issue of late is that 10-year interest only periods are coming to an end on many property loans. As we move towards the end of 2018, many people are seeing their mortgage payments convert to capital plus interest, causing significant rises in payments to Banks. Couple rising mortgage payments and associated costs, such as IBI tax and Community Fees, with the property value being lower than the mortgage balance; owners are feeling the strain.

Unfortunately, we keep reading forum posts from owners who have handed the keys back to the bank and walked away. Despite best intentions, this does not conclude their liability. In many instances the bank will proceed to sell the property at c70% of the open market value, leaving significant outstanding shortfall debt. Should the lender deem it necessary, they may seek legal judgement in Spain, putting your UK assets at risk through the European Enforcement Order.

Another common problem we see is borrowers who are in Negative Equity marketing their property at a price higher than the current market value in order to cover their mortgage. The main issue here is that any potential purchaser utilising finance will only be able to borrow on the current market value of the property, simply meaning a purchase cannot be achieved at the vendor’s desired price.

We recently met with a lender in Spain to discuss their current protocol in terms of non-performing loans. This eminent lender has confirmed their intention to clamp down on the 5,000+ non-performing loans on a purchased mortgage book, with all borrowers being from the UK and Ireland. They are instructing legal firms in the UK to place charging orders on UK assets for unpaid arrears, providing they have judgement in Spanish courts. This is having a significant effect on investors’ UK assets and equity held at home.

Despite many thousands of borrowers facing these issues, there are solutions available and it is important not to feel trapped.

An option open to +borrowers is the orderly disposal of the negative asset, be it through open market sales or voluntary surrender at the lender’s discretion, followed by lender write down, or in some instances, debt write-offs in full. At times it is possible to include Community Fees and IBI tax debts in these settlements.

Another option open to borrowers in Spain is to sell the property and pay the mortgage shortfall difference. This option is unattractive to most, given the expense of property sales, along with a significant payment to their lender being required. All other property associated debts must be cleared to allow this to complete.

As the market improves there is hope for some overseas owners in Spain, but a large proportion have fallen foul of the market decline. Many blame themselves, but frankly, no one could foresee the decline in the market and the impact it would have on so many. Loose lending practices by Banks at the peak of the market coupled with the following market decline has left many people in a trying situation, due to no fault of their own.

Far too many bury their heads in the sand without realising there is a way out.



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Can overseas property debt affect my chances of buying a property back home?
18 June 2018

A frequently asked question is whether an overseas property debt issue can affect your ability to buy property in the United Kingdom or your home country. There are circumstances in which it might.

The first thing to bear in mind is that it’s always a good idea to cooperate with your lender when you find yourself in distress. Many borrowers believe that their only option is to surrender their keys to the Bank and walk away from their overseas property in the hope that there will be no repercussions at home. You could call this the ostrich move, and it’s not recommended, as there are often other options.

In our experience, Spanish lenders have been known to place interim charging orders on uncooperative overseas borrowers. If you hope one day to sell your property to fund another purchase, your Spanish lender will have to be paid back first, with interest and charges. That could limit your budget in the UK.

We have also noticed a new type of issue for overseas borrowers. If you have borrowed in the UK to buy a property in Spain, then your mortgage is under the jurisdiction of the United Kingdom. We know of instances where borrowers have defaulted on mortgages taken out in the UK, which has allowed the lender to get the default recorded with the credit agencies on the borrower’s credit file, rather than going through lengthy Spanish Court Processes to achieve a judgment. It is unlikely that any lender will offer a mortgage to a borrower with a default on their credit report, so this can prove disastrous to those who need a mortgage to buy in the UK.

Cooperating with your lender is always recommended.

See the below graphic for the Do’s and Don’ts of overseas borrowing:


 

 



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The Do’s and Don’ts of dealing with overseas debt
06 June 2018

 

It is important to understand the correct way to deal with overseas creditors.

Unfortunately, there are many stories of borrowers acting in a way that jeopardises potential settlements and their home assets or income.

Below are the Do’s and Don’ts of dealing with overseas debt.

What to do: –

  1. 1. Liaise amicably with your lender. You will find that many lenders will work with you to find a solution to your debt issues. Many Banks have a commercial decision to make in a lot of overseas debt cases and will look to minimise their losses. If you act amicably and provide the Bank with their requests, in terms of information, you can typically come to an agreeable solution.
  2. 2. Appoint an intermediary. Intermediaries understand lender processes and attitudes and the requirements to achieve settlements. Furthermore, given that debt is such an emotive subject with borrowers claiming mis-selling and lenders believing borrowers aren’t repaying their debts an intermediary can remove the emotion and seek a clear outcome.
  3. 3. Be honest and transparent with your lender. Despite being overseas numerous Banks can locate information regarding your financial circumstances through legal and land registry searches. It is essential you are honest and upfront with your lender. Hiding assets and income will come back to haunt you, and, will have an impact on your reputability.
  4. 4. Be Patient. Any Bank offering debt forgiveness is writing down potentially tens of thousands of euros on their loan book. Of course, a decision like this will take time. Be patient to get the result you want.

 

What not to do: –

  1. 1. Putting your head in the sand and ignoring the bank. We cannot stress the importance of refraining from this. Ignoring the bank will cause friction from the outset and jeopardise your home assets and income. Ignoring the Bank will ultimately see the property go through repossession and you will be pursued at home for the outstanding debt balance should the property value not meet the outstanding mortgage balance.
  2. 2. Assuming the mortgage was mis-sold. Any legal claim regarding this will be lengthy, expensive and fruitless. It would be more cost effective to liaise with the lender to gain an amicable settlement. It is key to understand there that many overseas courts are inundated with property claims.
  3. 3. Withholding your full financial circumstances. Overseas lenders can still seek information regarding your home assets and income. If you withhold information from the bank or lender, you may jeopardise any chance of debt forgiveness and put those assets at risk.
  4. 4. Being aggressive and impatient. If you are aggressive in your approach and push the bank too hard for a settlement it simply won’t work. Instead, you will rile the lender who will dig their heels in and be uncooperative regarding proposals.

 

If you are burdened by overseas property debt, please take the above on board. Our advice could prove fruitful in your quest to achieve a settlement and closure. As stated, it is in your best interests to appoint an experienced intermediary.



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BANCO SABADELL & HALIFAX MORTGAGES
13 April 2018

Banco Halifax Hispana was incorporated in 1993 to serve the needs of Expat buyers in the Southern Costa’s in Spain. Many investors took out mortgages with Halifax, given they were at trusted UK High Street lender giving them confidence in their overseas property purchase and finance they obtained.

 

Unfortunately, many borrowers now find that their loans are no longer with Halifax. Initially, the Building Society was demutualised in 1997 and merged in 2001 with Bank of Scotland to become HBOS.  In 2010 the Lloyd’s Banking Group acquired HBOS and the branches located in Spain became Lloyds Bank International. In the final banking change in 2013 Lloyds Banking Group agreed to sell its Spanish Operation to Banco Sabadell, initially under the banner of Sabadell Solbank and was then fully integrated into Banco Sabadell in 2014. More recently, they have been aggressively enforcing interim charges on peoples UK homes.

Many investors borrowed from a trusted UK based Building Society in Halifax given they could liaise in the correct language with the lender and deal with the mortgage in both Spain and the UK. It is important to remember many of the loans sold by Lloyds Banking Group have become default and problematic. Essentially, Sabadell acquired a non-performing loan book and are doing their utmost to solve the issues for borrowers.

 

One reoccurring issue is that Halifax sold 10-year interest only mortgage products which are now coming to a stage where they enter the repayment phase of the mortgage. There have been significant jumps in mortgage repayments often reaching thousands of euros per calendar month. Couple rising repayments and declining property values since 2008, we are seeing many borrowers struggling with their Banco Sabadell Mortgage.

 

Too many of these struggling borrowers opt to surrender the keys of the property to the Bank and do not enter further dialogue. This is the incorrect way to handle the matter and we know Banco Sabadell have obtained second charges over defaulted borrowers UK home properties.

 

Whilst many investors look to place blame on the Bank they did not write these mortgages and instead are working with borrowers to end their Spanish Property issues. Their proactive methods and legal approach allow overseas borrowers the opportunity to dispose of their property with minimal costs and issue providing it is done through legal avenues.



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The history of the Spanish property market
22 January 2018

From bubble to boom

The Spanish property market has had a checkered past and is one that is characterized by booms and busts. At present, the market in Spain is looking noticeably healthier, with figures indicating that sales had soared in October 2017 and were up 28%. Things weren’t always looking so rosy for investors in Spain or those who owned a holiday home there though.

Read on for our recap of the history of the property market in Spain.

The property bubble

There have been a number of property bubbles in Spain, all of which are characterised by long-term increases in the price of property in the region. The most recent one took place between 1996 and 2008 and saw the prices grow at alarming rates.

Because of the global financial crisis that occurred globally between 2007 and 2008 that economists have described as the first financial crisis since the Great Depression, the price of property steadily began to fall again during the time that this was happening.

Adjustable mortgage rates during the bubble

A notable element of the Spanish real estate bubble is the fact that around 98% of the loans that were taken out during the bubble period were adjustable rate mortgages. These mortgages combine to form over 60% of the value of the Spanish GDP. This should give an indication that a lot of people owe a lot of money on their mortgages in Spain.

To compound the problem, as the crisis has erupted after 2008, people find that their interest rates have risen and so have their mortgage payments. Because of this, people that purchased property in Spain during the bubble are still dealing with the consequences of being saddled with debt which, for many, has lead to them finding themselves in negative equity.

What are things looking like now?

The property market in Spain in 2007, and while figures still suggest that things figures are still 39.8% below this level, there is significantly more confidence in the market at present. The property market in Spain remained strong throughout 2017 and it is thought that things will continue like this during 2018.



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How to overcome the loss of your holiday home
13 December 2017

How to overcome the loss of your holiday home

When you are forced to sell your home abroad, it can feel like letting go of a dream, and moving back home can be a challenge.While it’s easy to bury your head in the sand, it’s important to try and remain positive, so check out our tips on how to overcome the loss of your holiday home.

Keep busy

There’s no point in dwelling on things that can’t be changed, so when it comes to the loss of your home abroad, try not to spend too much time obsessing over what you’re missing out on and instead keep busy with things that you enjoy and make you feel happy. This could be meeting friends or going to the gym, but whatever it is, try to keep your mind from running away with you.

Get on top of your finances

If you’ve been forced to sell your home abroad because of financial complications, one of the best ways that you can make yourself feel better is to make a financial plan and stick to it. Whether this is to save some money each month or contribute to paying off loans, having an idea mapped out of what you need to do is going to make you feel much more proactive.

Do things that remind you of good times

Just because you have lost your home abroad, that doesn’t mean that you have to let go of all the good times you had and the fun things that you got up to. If you had traditions or things that you would do frequently in your holiday home, why not continue doing them back in your UK residence? Of course, some things won’t be possible, but if it was having a cooked breakfast every Sunday, eating outside a few times a week or having a games nights on the weekend with your friends, these things can easily be continued wherever you are.

Go on holiday

The attraction of purchasing a holiday home was being able to relax and enjoy a warmer climate, so why not continue doing this by going away every once in a while? It doesn’t have to be a big, expensive holiday, even just a long weekend in a sunnier part of the UK will perk you up.



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