Is The The Tide Turning

Hi All

 I have brought this subject up before but this appears to now have some substance.

An agreement to buy something is between 2 parties and while there is no doupt the Spanish developers have to say the least have screwed many some in return have been well srewed themselves

I have always wondered why the developers/banks havent taken a buyer to court when they have fulfilled their side of the contract,including back dated mortgage payments and management fees.

Now I am not an expert so thoughts would be welcome on this.

'Following the provisional approval of the new Marbella PGOU the courts have seen a sharp decrease in the number of cases of buyers of illegal properties taking the developers to court to demand their money back. Now the majority of these properties will be made legal by the new urban plan and this has even led to a complete turnaround in the court cases. Some developers are now taking their clients to court to oblige them to fulfil their side of the contract and sign the title deeds for the property they paid a deposit for.

According to a Marbella judge, although many owners no longer have a case against the developers now that the properties will not be illegal, some, due to the economic crisis, are no longer interested in the investment and want to continue with their lawsuit.'

http://www.surinenglish.com/20081211/news/costasol-malaga/provisional-approval-marbella-pgou-200812111741.html

This Judge's thoughts are very worrying.

Now if this is the trend and the reverse happens, the developers/banks win then thousands cant complete due to no mortgages and the exchange rate.

Will they in turn alongside the Banks chase those with assets in th U.K as Banks are doing this now on non payment of mortgages.

Just Dan

This message was last edited by Just Dan on 12/12/2008.

From my point of view, there is no reason why not. However, it could be tied up in court for years as the UK courts who would have to enforce this may take a differing view. I know that whilst we are in Europe, certainly in the case of divorce settlements, an agreement here can only be enforced in the UK providing the grounds are aceptable under UK law!

A UK court may take a different view and if chasing for debt in the UK with the asset in the UK, this may enable jurisdiction to be moved there - and if any judges have been caught up in Spanish property, they may not be as maleable as Spanish judges seem to be!

Unless of course an EC directive is rushed though to enable this!!

Hi Rixxy

Think this just might start to get people who have yet to complete something to think though as it has done for me.

Some how Spain,its Banks and the whole sitution has to get resolved and what a way to do it.

Bank Guarantees need not be honoured on mass scale ( coulnt possobly anyway)and only in the most blatent cases

The fact that Bank Guarantees have not been issued would then not be such an issue

The fact that the buyer could be tied up for years with the thought that interest rates and costs are being added is frightening.

As I have mentioned I think its right that Spanish Banks are chasing U.K assets for mortgage arrears and thats to close for comfort.

The hunter becomes the hunted.

One thing seems likely that its going to stop many in their tracks in the fight for justice.

Please someone tell me I am wrong in what I am thinking but this whole mess in the courts going round in circles could be part of the longer term plan

Just Dan

THe lack of financiation possibilities ( which in many cases has been produced by the delay: credit crunch  happens now but not 2 years ago), is an argument aproved by many institutions of the Real State area in Spain for the refund of money paid.

JUdges are difficult sometimes, but that cannot stop us from claiming , under the legal direction of a good specialist of course.

Pat (Smiley) may wish to add his experience here however it is my knowledge that lender i n Spain cannot pursue a mortgage debt via the UK with the intention to seize assets as they cannot take these assets into consieration when granting the mortgage in Spain.

Not directly they cant but if there is a debt here in Spain and the mortgagor a non resident UK person, then the court order can be admitted to a UK court for action, in which case the defaulter puts any assets he has there in his name at risk.

Perhaps I am wrong (nothing normal here)

Many people will be getting into trouble with payments and my understanding is that banks do chase your U.K assets for for non payment

Now handing back keys surely is the same as not paying so there is a grey area here.

Are mortgages in Spain secured on the property in Spain only if you had the keys back.

Just Dan

I think what Advisor is saying that when a mortgage is granted in Spain, it is not attached to a UK asset therefore the theory being the asset is not touched in the case of default.

The asset in Spain is security for the mortgage, but what we are saying which Advisor I think has not quite picked up on, is that if the debt is not cleared by way of legal respossession, the outstanding amount becomes a debt against which the bank can chase the mortgage holder for in his own country. If the debt is not settled by payment, then assets to the value of the debt will be seized in order to satisfy such debt.

In other words Just Dan, yes the banks chase you and yours to clear their debt.

Rixxy

as mentioned that was my understanding ,are you 100% sure of your reply as if so it is useful information to know.

Yep Rixxy

Me to and are they doing it as my information albeit over a year ago was they dont.

Anyway on a positive note I suppose we could appeal then it could take a long as 10 years.

Just Dan.

P.S.   As important what if the developer does win the day in court and he forces completion or sues for breach of contract. and costs etc

As we cab see with regards to Bank Guarantees,habitation licences and contracts in general they chance the rules as they go along

If the case were to come up in a UK court, I am not sure how a judge would view it.  My wife has told me (she works in mortgage arrears at Barclays) that at the moment, many UK loan companies are pursuing defaulters on unsecured loans and applying for charging orders against the property. To me this sucks!! You pay a higher rate on your loan for it to be unsecured, then they stiff you with a charge anyway!! But........

Many people are ready to throw in the towel by then and don't even turn up to court. If you fail to show, the judge will almost certainly rule in the lenders favour and against you. If you were to turn up and say you disagree with a charging order because (whatever your reasons. Unsecured loan. Finance secured on an overseas property), chances are a UK judge would agree with you and rule in your favour. That isn't to say the Spanish banks can't pursue you in other ways though.

Mark

Hi Mark

Seems life is a bit of a bitch and about to get worse for many caught up with court cases in Spain due to the reality of the exchange rate as this hits even the ones paying legal fees

The issue with the developers leaves me with an unanswered question and in Span thats not so good.

As you have pointed out its an open shop with the Banks desperate to re- balance the books due to their actions in the past

Banks may have be a different situation with regards to the exchange rates and thats they let people talk things through to resolve  thing even on a tempory basis or its going to be mass Re-Posse in the U.K. and in Spain

Still suppose you could be an owner of Spanish property purchased 20 years ago in a good location which is being converted into sterling.

Just trying to find snippets of  better angles to look at you understand

Just Dan

After Mr Madoffs recent rip off and his connection with a nmber of the spanish banks along with those in the UK it is likely that they will try to claw back more money form whereever possible.

Hi

Think you may be right and a case of watch this space while the rules are changed against us all I feel.

Regards

Just Dan

I havent yet heard of this actually being done by banks but there is nothing to stop it being so. Dont forget many mortgages were packaged and sold all over the place so who is to say a UK entity doesnt actually own spanish loans!!

If a debt is owed in a country and the person is sued in court, the debt is lodged to him, then why wouldnt it be taken to the country in which ther person lives in order to at the very least secure the debt onto an asset? I have myself had to sue someone in Ireland and have a charge against his home, I am in process of requesting a forced sale to satisy this debt, and thats a individual! It has taken over 4 years thus far however!

The legislation is there, criminal law allows cross border policing, we are only talking civil law. I cannot see how a UK court could refuse to enforce a debt where cause is shown in another countrys court, especially in the EC.

I really cannot see the banks just sitting on dead equity, I suspect in a year or so they will sell them for whatever and follow this through. I feel at the moment its the courts preventing this as they do not like to take away peoples homes, unless in very extreme cases and banks hate to show losses as then they have to report to the BOS, affecting their ratings, however thay cannot reasonably sit on many thousands of proeprties - or maybe they can and become landlords, I do know several properties which are being rented out by banks.

Time will tell!

I was talking to the wife about this last night, and my thoughts are still the same. All requests for charging orders against property mortgaged by Barclays has to come through her office and there have been none from overseas (yet). That is not to say it won't happen, but again I have to say the likelihood of a UK court allowing a charging order against a UK property if the case is defended is slim. She has also said that people in the UK that have multiple properties are not pursued with a charging order on another of their properties.

I am not saying you should be able to pack your bags and leave the debt. I was unlucky enough to be repossessed in the 90's (before the CML luckily) and the bank pursued me for 8 years for the deficit. They wouldn't make me bankrupt, neither did they ask for a charge on my then current property but I was able to finally make a lump sum payment.

I did also ask if a UK bank with subsidiaries overseas (such as Barclays) would be able to receive defaulted mortgage accounts from other countries. I.e. Barclays Spain defaulted mortgages sent to the UK for adding to the UK mortgage book. The answer to that was no, the systems are not in place be able to allow tat to happen.

At the end of the day, I suppose it is going to be a wait and see scenario over the next 12 moth or so. The good news is my mortgage has just gone down €50pm though .

Mark

I can see a spanish bank trying to go via its internal system to a same name in the UK wouldnt be able to do that, but I cant see where there is money owing to someone, why that person (or bank) owed cannot pursue the defaulter in another country. The debt cant be defended, if its owed, its owed and therefore payment of the same has to be satisfied in some way.

I reckon the biggest problem are the courts here as without the judgement here in Spain the banks would be unlikely to follow small debts to the UK, might be more in their interest to write them off leaving a charge on the debts register here.

I had the same as you Marksfish in the 90s - I had 2 properties repossesed (original buy to letter!) I ended up declaring personal bankruptcy which meant a line was drawn under everything and I started afresh. Several people I know were like you followed all over the country and made arrangements to pay back.

I suspect in a couple of years we will see a difference in attitudes of the banks.

Intereresting

An unsecured dept is just that and rightly it can be said that you should take someone to court and ensure payment

Now.on the other hand it could be said that both parties entered into an agreement which is.......

Buyer and lender enter into an agreement where a deposit is paid and the lender is willing to lend on an amount based and secured on the property.

If the buyer defaults then he looses his deposit. Now this was a loan secured on the property and the Banks agreed this and if they are then going to pursue other assests then surely  what was the point in the first place and say the loan was unsecured.

We all know the Banks would never act in the interests of the buyer or themselves when selling to those in the know at cheap prices if they had to be accountable for the overall loss.

As you say they just may have to change to at least try to work with those with problems that are trying to get through this massive credit problem caused by them.

Just Dan

t

Beacause the various mortgage clauses say if the securlty does not satisy their debt when it is called in due to default, then you are personally responsible - oh that it were not so!!!!!!

Oh Yep

They would have their arses covered on having a loan secured on a property where they were happy to accept repayments that would have paid for the property 3 times over at the end.

Just somehow and perhaps this is me but  surely this should be down to Banks having lent responsibly in the first place.

Most deals there are risks and often involve a shared risk so why is it that they come out of the shit for being crap at lending in the first place.

To me in these troubled times as both the buyer and the lender agreed a deal they both need to look for a solution and an indendant body set up to minimise the disaster at the mo

Everyone should pay but there has to be an easier way than putting people out on the streets unless they are not willing to help themselves.

Rixxy .Hows my spelling .

Just Dan