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Do you have a proper BG ?
Be careful with some developers and Banks producing useless BGs, usually they show you a copy of a bank certificate which is general for the whole development.
If you have a BG please check whether is referred :
1º The name of the guaranteed (beneficiary) Your name and NIE or passport number
2º The amount guaranteed. The exact amount you have paid plus 6% (interests)
3º The deadline Must be until the FLO is granted
4º How can I execute the BG. Check the words "a primer requerimiento". If you don't have these words you have to go to Court in order to execute the BG
5º What is really covering the BG
If you don't have a BG with all this elements you are not protected against bankruptcies or endless developments
Don't believe in Agents Lawyers etc, check these points personally even if you don't understand spanish and you'll realise whether or not you have a valid BG
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www.fljordan.com
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Hi thanks for the BG info but what is FLO What should I look for on the BG document to tell me this
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I think it refers to the licence of first occupation. I would like to know where to look for "a primer requerimiento". Thanks for the info.
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Hi andenca
FLO means First Occupancy Licence
Read all the text of your BG and try to find these words 'a primer requerimiento'
Generally If you have this words in your BG you won't have any problem in order to execute the BG but if your BG does not have these words get ready for go to Court.
Get a translation for your BG and you'll know exactly the conditions imposed by the bank. Sometimes these conditions are not fulfilling the law. Banks draw up BGs according to the developer instructions not according the law because they are not liable
Nowadays with several bankruptcies it is crucial to have a BG type 'a primer requerimiento'
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www.fljordan.com
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Hi
When I purchased off plan 2 yrs ago I was told by my solicitor that we had a bank guarantee.
I purchased at San Cayetano and the builder is Taray.
I am now having a lot of problems and asked my solicitor for a copy of the bank guarantee. She said they had not got one.
When they asked Taray for a copy they have not produced.
Does this mean I have no guarantee? and is the builder in breach of contract for not producing it.
Any help appreciated.
Dave
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Hi Laser
It seems to me that you don't have a BG, your lawyer didn't do his job properly and now you will suffer the consequences. Many conveyancing solicitors (most of the spanish lawyers who speaks English) hide the lack of BG because they just have clients referred by agents and developers, those are the only source of their incomes. Also in many occasions they don't worry about whether the BG is proper or not. For this reason we always recommend to have the original of the BG with a English translation
Do you have any provision in your contract about BG ? Do you have any email from your solicitor mentioning the BG ?
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www.fljordan.com
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I have a section in my contract that says
Amounts Already Dispursed
In order to guarantee all amounts already disbursed by the Purchaser towards the purchase price, TARAY, S.A.U. shall set up a line of bank guarantees with the bank the company may think fit.
It is my understanding that all off plan builds should by law 57/68 be issued with a BG.
Failure of the developer to issue such guarantees after each stage payment means the vendor can cancel the contract and get all monies plus interest refunded.
Can you confirm.
Cheers
Dave
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Hi Laser
Perhaps you have any provision in your agreement about the reasons to cancel your contract and surely you can't find one regarding the future lack of BG so it will be quite difficult (not impossible) that any Spanish Court accepts such argument in order to get your monies back. But I think it'll be your unique option
Actually the lack of BG is an administrative offence and the developer could be fine but the point is that nowadays they don't want to issue proper BGs because a flat market. They don't have enough cash therefore they are reluctant to issue a proper BG.
After summer we'll be facing with hundreds and thousands of buyers in endless developments finding out that they don't have BG or if they have one is drawn up disregarding 57/68 Act. These buyers were trusting in unscrupulous lawyers, agents and developers who now left clients in a very weak position jeopardizing the legal refunds that they are entitled to.
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www.fljordan.com
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Hi Spanishsolicitor what about ALVA on BGs another solicitor has said this is the important thing if you have this on it you dony need to execute it through the courts .Is there any truth in this. thanks
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Excuse me Julie,what does ALVA mean ?
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www.fljordan.com
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I want to add, in order to leave some stress, pressure and fears off that, even if the Bank Guarantee is not validly issued ( i.e.- It is subject to an expiration deadline or, ir does not cover full interests or have any minor error...) by the force of Law 57/68 and General Building and Consumers Act, it is fully enforceable till the First Occupation License is issued as the expiration deadlines or the omission of coverage of interests are illegal and therefore null and void. The word of the private document it is implemented by the force of the Law.
So my advise is.... once you have a Bank Guarantee ( even expired) do and execute it: it is quite probable that the Bank or the Insurance Company will not honor it first try but.... a good executive defense ( with the help of a good litigation lawyer) will succeed for sure... There is Case Law which covers this approach, of course.
Thanks to the Law!!
Cheers!
Maria This message was last edited by mariadecastro on 7/2/2008.
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Maria L. de Castro, JD, MA
Lawyer
Director www.costaluzlawyers.es
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Thanks for that Maria.
In my case I paid my deposits in 2006 but Taray never issued the bank guarantees.
My solicitor has just requested from Taray the guarantees to cover the payments I made.
My questions are.
1. How long do I give Taray to produce the guarantees before I ask for deposit back due to breach of the law.
2. If they do produce the guarantee are the still in breach for not producing at the correct time.
Cheers
Dave
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What is the stage of the building at the present moment?
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Maria L. de Castro, JD, MA
Lawyer
Director www.costaluzlawyers.es
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Building is completed but the LFO has not been granted yet. They think about Septrember 2008 for the LFO to be granted.
Dave
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We have a Bank Guarantee with BBVA they are willing to pay the amount stated on the Guarantee but not the legal interest is this normal, our solicitor has sent them 2 burofaxes which they have not responded to. Are they within their rights legally only to pay what is on the guarantee? We do not want to take them to court as this would take too long.
Cathie
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Cathien
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Hi Cathie
"I want to add, in order to leave some stress, pressure and fears off that, even if the Bank Guarantee is not validly issued ( i.e.- It is subject to an expiration deadline or, ir does not cover full interests or have any minor error...) by the force of Law 57/68 and General Building and Consumers Act, it is fully enforceable till the First Occupation License is issued as the expiration deadlines or the omission of coverage of interests are illegal and therefore null and void. The word of the private document it is implemented by the force of the Law.
So my advise is.... once you have a Bank Guarantee ( even expired) do and execute it: it is quite probable that the Bank or the Insurance Company will not honor it first try but.... a good executive defense ( with the help of a good litigation lawyer) will succeed for sure... There is Case Law which covers this approach, of course."
Posted by Maria below. I am not a lawyer but I think the interest is enforceable in law and BBVA cannot dodge the issue. Guess your lawyer needs to advise them that you will go to court for full recovery if they are not willing to reconcile your claim and fulfil their obligation.This message was last edited by Smiley on 7/4/2008.
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Smiley - patrick@marbellamortgages.com www.marbellamortgages.com www.comparetravelcash.co.uk
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Hi
I posted this on my off-plan forum and one of my posters suggested this thread would be a better place for my posting. Any comments appreciated.
"I asked my solicitor for a copy of our bank guarantees for deposit and stage payments made a year ago on an off-plan in San cayetano, Murcia and have just had this reply. Here is a quote from her email -
'regarding the bank guarantee we have been promised by TARAY that the mentioned document is on its way and you can rest assured that we will contact you further as soon as a copy of this bank guarantee reaches us'
As far as I can see this means that my solicitor DOESN'T have copies of our guarantees!!! Shouldn't they have got these for us in the course of acting on our behalf! Do we really have to tell our solicitor what to do?
We bought our phase 2 quad villa last July and made our deposit and stage payment whilst we still out there on our Parador inspection trip, so Taray have had our money for over a year now!
Any comments as to the professionalism or otherwise of our solicitor appreciated."
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I guess No Comment would be the most appropriate. Your lawyer should really have made sure there was a BG in place and provided a copy to you (IMHO). Some lawyers in Spain do not have the same level of expertise or degree of professionalism as others - this does not necessarily mean that biggest or highest profile is best either. I have heard of serious failings in terms of big legal practices that one would have thought would provide a better service than they have. It is highly possible that some of the smaller less well known ones can be better as they are more dependent on personal recommendation.
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Smiley - patrick@marbellamortgages.com www.marbellamortgages.com www.comparetravelcash.co.uk
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You just have to press your solicitor all the time
Some developers just produce them quickly, others delay and delay as it cost them money
They are in breach of the regulations and I understand that they can be fined up to 25% of the amount of the guarantee amount
Get your solicitor to give them a deadline to produce it and if they do not get them to take legal action
As everyone seems to be on holiday in Spain in August I suppose now it will be September before you can take any action
In the current economic climate you either want your BG right now or your money back [ or at least put in a joint account until you get a BG]
The quad you have bought is very nice but the builder will want to keep you as a customer so you can apply as much pressure as you want
Anyway, there may be some better options out there now and at least you would have changed your deposit at a good rate compared to today
So just chase hard ....important
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Rymski:
Ask your solicitor to:
1.- Send inmediate burofax to developers requesting the guarantee under the consequence of cancelling the contract ( it is possible if you have reiteratedly asked for it ( need to have written proof) and have not been granted with one.
2. I would also suggest, given the passive approach of your solicitor to ask them to show the sending of the burofax to you or even....
to change to a more proactive and determined solicitor, accorring to what you have told, I see very few guarantees with the present one, does not seem to be very cocerned on the lack fo that important document. Essential always. Most essential in the current state of real estate market.
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Maria L. de Castro, JD, MA
Lawyer
Director www.costaluzlawyers.es
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