NIE in Guadamar

In March 2003 I acquired the services of a solicitor for the purchase of my apartment in Don Juan. I have recently obtained the offer of a mortgage by a british company on terms that suit me. However the bank prefers to use their solicitor which is not very convenient at this stage of purchase, The banks solicitor charges approx 2600 euros to represent the bank only, or 35000 euros to represent me and the bank. Can anyone expain why I have to pay for the banks costs. hope that someone out there can throw some light on this subject. all the best Bevron. 

Hi Bevron It must be part of the terms of the mortgage offer by that particular bank that you have to pay their legal fees. Normally banks will only let you use solicitors on their 'approved panel' as they trust these firms to do the job 'properly'. You could try and see if they have any alternative firms on their panel and or you could try and negotiate the fees directly with those lawyers. Alternatively why not ask your broker if he can get an offer from another bank that does not require you to pay their legal fees (probably a rare thing on the coast - as everyone there seems to want money!).

Hi R.G. Thanks for the reply to the question of the solicitor. I have not replied until now because of the need for verification from my own solicitor. What you have told me appears to be spot on, Thanks very much for your time. Bevron. 

              I have just had a breakdown of the financial costs remaining on my purchase at Don Juan 1,    My solicitor faxed through the estimated costs.   Included in this costing is an amount for cancellation of the builders mortgage?.  I have to admit that I was unaware of this mortgage,  seeing that I have had the cash deposited in a spanish bank to pay for the apartment outright.  I have never asked for a mortgage or needed one, and nobody has mentioned this to me over the last four years,    

                Any other person/s heard about this builders mortgage,  I would check this out , surely it can't be just my solicitor neglecting to inform me,  can it?..

Hi Bevron We were told by our solicitor at the time of purchase that if we didn't take up the builders mortgage we would have to pay the cancelation fee on the builders mortgage on completion. I can't remember the amount but I think it was around €1000. 

Hi Bevron,

We were also told there is a developers mortgage in place based over a 15 year period. I believe it is +0.75% over the euribor rate, but you may need to double check this. For those thinking of getting a different mortgage elsewhere, it can be very expensive to set up, 2-3 thousand euro if i am not wrong, plus the cancellation fee of the developers mortgage. Does anyone have the full terms of the developers mortgage yet. Can we make overpayments, if yes what are the restrictions,is it interest only or repayment, are there penalties for paying in full before the end of the 15 year period.

Westport

Hi, Our solicitor informed us about this developers mortgage and we were told that we upfront had to reject this mortgage or we would as you are telling have to pay a cancelation fee. This was the reason why we stated in the contract that we didn't want the developer mortgage.

According to Smiley it is illegal for the developer to charge you a cancellation fee. He has posted this answer on another post.

Westport

Hi all,

regarding your charges from the developer about cancelling your mortgage, this is an illegal practice and you should ask your laywer to represent you in avoiding this charge. If they tell you other wise then I am afraid you have a laywer who either does not know their stuff or they are protecting the developer.

I agree with Danzacurt and Westport the cancelation charge I have just learned is illegal and the developer cannot force you to pay it, this is posted in the general boards of this site & i have also read it in abook entitled 'You & the Law in Spain', a very useful book!. When my gestora signed the contract back in 2004 she advised me about the cancelation charge and told me that I have to pay it if i did not take up the mortgage. I now know how useless she is and am in the process of changing lawyers. Also if it helps anyone I have also just learned that the penalty clause of 30% flat rate for any late payments made to the developer in the contract is also illegal. We paid our last installment late and was informed by our Gestora that we had to pay 30% of that installment amount as a penalty, I have now learned that all they can charge me for is 30% per anum for the number of days I was actually late.... another reason for changing to another lawyer!

I have just received a fax from my solicitor in regards to the mortgage cancellation fee (1300 euros). I no longer have to pay this. Many thanks to   Davmunster,  Westport, Wichmann, Danazcurt and R.G. for your replies.. Just goes to show the true value of this site.. Thanks again.. Bevron. 

Hi Max,

I do not have a copy of the builders mortgage package. Do you know if we will be tied to their banks buildings,contents and life cover, as this can be expensive.

Cheers

Westport