Repurchase / repossession - advice needed

https://advocateabroad.com/legal-answers-spain/property-law-spain-answers/selling-a-property-with-a-sitting-tenant-2/

Although this refers to a sale of a property,    I would think the same must apply if the new owner is a bank.

OK Brian, is that definitely the law in Spain, no if’s and buts’, and the way it is applied by the courts and justice system?.

I think to answer that correctly the tenant would need to instruct a lawyer to comb through the Spanish laws and layers of changes made.   I feel the lawyer would find some nuances to exploit and take a lot of money while they fight a case on their behalf.   They may be successful in keeping the tenancy for a little while longer, while making the tenant much poorer and more stressed.

The facts of the matter would be that the bank has to repossess a property and they are not in the business of home ownership.   The tenant has a tenancy agreement that was not made by the bank and they will be insecure (imho) going forward.  

Best advice at a calculated guess by me, with some experience of these matters......

Find another place to move to and make arrangements to get out, use any spare money to sue the owner (the one you have an agreement with) if you are substantially out of pocket.   Put it down to one of life’s unfair events and move on.

Duplicate post

Interesting John

Lodging a Long Term Rental at the Land Registry – Advantages

Long term tenants are advised to lodge their long term tenancy agreements at the Land Registry for their own protection against third parties i.e. landlord defaults his mortgage and falls into arrears. His lender executes the contract and attempts to repossess the property. A tenant´s position is stronger if his tenancy agreement was already lodged at the Land Registry. He can in fact negotiate with the lender to leave ahead of the rental´s expiry date in exchange of a suitable compensation for his aggravation.

There is a litle  'light reading' here:-

http://www.spanishpropertyinsight.com/2016/05/13/urban-rental-law-spain-tenancy-agreements-ley-de-arrendamientos-urbanos-lau/

OK Brian, is that definitely the law in Spain, no if’s and buts’, and the way it is applied by the courts and justice system?.

Yes I’m saying the first part.  

The second part doesn’t apply 

Brian, are you trying to say that in these circumstance, in law the owner has defaulted on the mortgage, therefore the rental contract is null and void and the bank is entitled to evict the tenant and his family onto the street.

Or is it how you would like it to be.

Marias Title 2 Articles 7 and 8 seem explicit in what I was saying.

If a bank chooses to sell at auction with a sitting tenant Windtalker, they would have to provide a tenancy agreement.

The only tenancy agreement the person in this dicussion seems to have, is one thats provided from the person who no longer owns the property (after the legal dissolution of ownership through not paying the mortgage).

If you buy a car and the person gives you a signed contract saying they will guarantee a warranty for 12 months, a court will say that contract is valid.  If the person providing the warranty has died, the contract will still be valid, but will be worthless.   Just like the tenancy.

If the mortgage isnt being paid, that contract will be enforeceable to repossess.   Do the maths and see who owns the house and what tenats rights are left!

Perhaps its a case of Is this a case of not wanting to understand?. 

See article 29 below:

https://www.eyeonspain.com/blogs/costaluz/11328/Legal-tip-1029-NEW-Spain-Rental-Act.aspx

One of the two businesses I run I the UK is ....property development /rentals...What this involves is going to property auction's and buying Repo /rundown   properties and the likes ....I have seen many a property go to auction with sitting tenant's depending on how long you have to wait for full ownership ..will reflect apon the price paid ..a property with tenants with a five year rental agreement ..would only devalue the property by 10% providing if the seller's could  prove that the tenants are good payer's/if the tenants are bad payer's ...you will expect a 50% discount if you had to wait 5 years for the keys ...most in the trade would tend to keep away .

what I am not understanding is how a person who no longer owns a house, can continue to rent it out.

Doubt they can legally.

 And how a tenancy can be secure when it’s set up by a person who doesn’t own a property any more.  

Is this a case of not wanting to understand?. Once the bank is granted legal possession (and that’s if) they inherit the tenancy agreement. If the bank does not want the tenant or the tenancy agreement they will have to apply to the courts to have it dissolved and the tenant made homeless. Of course it is possible the courts will refuse.

That’s what the aim is for me Kavanagh.     It’s not a question of what I like, but what is correct and can be understood.

what I am not understanding is how a person who no longer owns a house, can continue to rent it out.   And how a tenancy can be secure when it’s set up by a person who doesn’t own a property any more.  

If you can provide the law that allows it, I can understand it.    But just because the tenant is really nice and pays their rent, doesn’t make it legal.  Lots of people who say, well this is Spain or you don’t understand because it’s not the UK are hiding behind the fact that they don’t know themselves (I often find!).  

Brian it’s not what you see that counts, but it is how the Spanish courts choose to see it that counts. Sorry if that’s not to your liking.

But Kavanagh......

if it’s not clear who’s getting the rent, this whole thread falls apart.   The property has to be paid for, that’s page one point one of any mortgage, otherwise it’s foreclosed.   

The tenant becomes a squatter when the mortgagee is subject to foreclosure.   It doesn’t matter if the tenant is really nice or is a complete idiot, I don’t see any legal tenancy.

Mortgage lending is a risk business, and it is the banks duty to be aware of those risks and pitfalls within the justice system. They will structure their products to financially take into account the known risks.

I suppose the tenant in this case will pay rent to whoever is the legal landlord.

Cases of bad tenants has nothing to do with this scenario, any tenant or property owner in the world can be a nuisance or defaulter. Any EOS member wishing to post about bad tenants should start a separate thread.

Perhaps a bit more thought should be given to the innocent tenant caught up in this situation.

Windtalker

I could not agree more, banks most definitely are unscrupulous but I think there are also dodgy property owners who exploit loopholes.

How else do they get away with offering 5 year contracts at very low €150 per month contracts.

In our Community, one owner owned 10 apartments which were finally repossessed by Santander ALL with sitting tenants.

They even tried offering the tenants a mortgage to buy at 50% of current value but only sold one.

Kavanagh

I agree in this case tenant is good, I was merely pointing out the possibilities of circumstances when bad tenants exist.

No idea how owners can sublet without banks permission, then default but it has certainly happened in abundance.

Courts also very supportive of not  making tenants homeless by nasty banks.

La Caixa has one in ours and pays the fees, now but the tenant has erected an illegal green mesh shading.

Community cannot force the tenant to remove it, we have to send Burofax to Bank, who it would appear cannot evict non rent paying tenant.

Some, it would appear can outdo banks.

😀

Pays rent to who?

hugh_man

''Possibly bad news for neighbours and Community IF the tenant decides not to follow Community rules.''

The tenant is of good behaviour and always pays rent on time. Why think differently?.

I am not disputing anything that you are saying Hugh Man...but knowing how unscrupulous the Spanish Banks are I am very surprised ..that they allow long term contract's on properties that they have mortgages on ...this subletting would not be allowed in the UK ...as the Bank's shareholders would not be happy having to wait five year's before they could Repo the property ...hence the maximum six month short hold contract's on buy to let's in the UK....this is good news to any one that is getting there so called property reposed by the Bank ...before they evict you if you want to have one over on them just rent the property out on a long term 5 year contract job done.