Non-Payers on Community - What are the Options

I have just received details of an EGM that has been called for the middle of August.  There are 3 non-payers of community charges, and another 4 who say that they won't be able to pay anything in the coming year.  There are about 60 houses in all on my community.  It looks as if the option will be to split the non-paid amount between the payers - this doesn't seem fair - until the denuncia is served etc or to close the pools down and sack the gardener.

I have been asked to fill in a proxy form with my comments, but before I send it off has anyone else experienced this problem?  It seems that a few can hold the rest to ransome.

Hi abbbb1,

I would say that your Presidente/Administrator should have a policy of zero tolerance towards bad debt.  Otherwise it could spread and be a major problem.   The Spanish seem to have a lackadaisical attitude towards debt, particularly when it's not their money.  

Of course there may be a special case if someone has just lost their job etc - but an agreement has to be reached, or they will need to consider selling up etc

With the recent changes in the legislation there are special companies who can chase Spanish debts in the courts of the debtors country, if this is appropriate.

Not an easy one, but important to act decisively or the problem will only get worse.

Good luck

Richard

 If your owners are from the UK Republic of Ireland or EEC Countries (Excluding Spain) You can take legal action through each countries legal system through a Uk based Company. In Spain you have to go through a very laborious legal procedure!

The Company is called www.Communityfees.com  They appear to have had great success in the past year particularly chasing arrears in the UK. We have employed them to persue  my own communities non-payers and we had positive news within days!!

I'm sure many non paying owners felt they were immune from prosecution in the UK but no longer! many people who have paid up will be very aware that swift court action will no doubt impact on their Credit Rating

Hi abbbb1,

why you or any community owner would want to pay somebody else's debt is beyond me, and if you did agree then it would be the thin end of the wedge. The way things are now some people find it difficult to pay a mortgage let alone a community charge, and out of the two they know the mortgage is the best bet. Then there are the others who don't pay because they know the laws in Spain and they can get away with it and still use all the facilities pools gardens lift etc. We have debtors on our community and we voted 18 months ago to start court proceedings against them and we know that it could take 3 years at least to bring them to court. We were also told that if the situation becames worse then the community would have to consider closing one pool and reducing community gardeners and  cleanners (we have two of each) to one only. Personally I would rather lose pools and gardener, than ever pay anybody else's debt, as there is always the beach and the sea to fall back on, and don't forget that if you agree to split the nonpayers fees between you that Spanish law states you cannot prevent them from using the community facilities. There is a family in the next block to me who have two children who go to the pool every day and they owe 4000euros and it's growing.  There is another couple who own two cars, (one is a mercedes) both working and owe 5000 euros, it beggars belief but that's the situation, would you want to pay their debt???.   I hope you come to a workable solution, fortunately we have a good president and administrator who have the good of the community at heart.

The opinions are very much appreciated.  It's nice to get other people's views on the situation

The community is about 5km from the beach.  It is a very mixed one with - Russian, Iranian, German, Belgium, Dutch Chinese, English - and two Spanish families!!  The loss of a gardener means some sort of rota system to do the grass and general maintenance!  We have two pools, one gardener and one pool maintenance man.

Will look into the website that you mentioned, Miket

1962 - The debt on our community is nothing like your - thank goodness!  But I suspect that it might get that way if people are allowed to get away with the situation.

This is an on-going problem and what you need to do is make sure you prepare your budget only taking into account paid community fees and that can mean cut-backs - ie don't spend anticipated fees becuase you never know when/if they will get paid!

Also it's a matter of cash and you can only spend what money you receive. Most communities can cope with a few debtors but if that number increases especially if developer does not pay on unsold units then you have a serious problem and there are only 2 solutions.

1. Increase quota on those paying, or

2. Reduce expenditure to match monthly income.

Both can be painful.

Also you then become a community with a problem and that can impact on ability to sell becuase who wants to buy into a community with problems?

Debt recovery in UK is very straightforward and you don't  need to use lawyers/procuradors but you may well find when someone stops paying community fees on their Spanish property their UK situation is equally as bad but certainly UK procedure is fast compared to Spain.

Check out www.moneyclaim.gov.uk

In my communuity the developer owes in excess of 80,000 Euros in community fees plus he has not carried out the 5 year painting programme so as you can imagine we  are broke .  He is one of the few deveopers who is not gone into liquidation but as he knows he can get away with it he won't pay up . And he has the d..... cheek to have his sister living in the site ?  He even brought in his own painters to paint the outside walls on his unsold appartments ???  The community has taken him to court but that is a joke.    It will be so sad to see a lovely development go down hill .  We cannot  afford   the fees to be raised  again to cover  these debts . Our only saving grace this year have been some of the banks who have paid up their outstanding fees on their defaut properties as they need to sell them.

Our friends on their comunity on the CDS has no tolerance at all .

Default - a letter is sent with a reminder , if this is not funded then a second letter is sent out and every owner if informed who has defaulted , if the paymenyt is not made they are taken to court.  It works every time .  What you need is a strong President and committee who must not deviate. 

EUR80k debt to developer is not unusual.

How can developer pay if he cannot sell?

Probably mortgage exceeds value on unsold units - banks won't deal?

or else he's tied up in litigation with buyers who will not complete and are demanding back deposits?

It's all one big mess ................... that will take years to resolve.

EUR80k debt to developer is not unusual.

How can developer pay if he cannot sell?

Probably mortgage exceeds value on unsold units - banks won't deal?

or else he's tied up in litigation with buyers who will not complete and are demanding back deposits?

It's all one big mess ................... that will take years to resolve.