A new decision by the European Court on mortgage expenses time-bar

EU ruling

The European Court of Justice (ECJ) has been a traditional supporter of consumer causes including defending the right to claim mortgage expenses.

The latest ECJ sentence sets out the rules for the deadlines for making the claims.

Latest ECJ Ruling

The ECJ sentence of June 10th this year has three implications for mortgage holders in Spain as follows:

Back to Square One With Compulsory Refund

The ECJ has ruled that when a clause is declared null and void, it is as if the clause never existed. In contractual terms, this means that both parties return to the legal situation they were in prior to signing the contract. It also implies a compulsory refund to the affected party. Plus there is no time-bar (see below).

Time-bar for Null and Void Clause

The ruling states that there is no time limit to claims for clauses that are declared null and void. Therefore, property owners entitled to refunds from null and void clauses in their mortgage contract may claim at any time.

In mortgage debt because of an abusive clause? Let us help you claim your refund now.

Time-bar For Compensation in non-null and Void Clause

The ECJ has also ruled about the time-bar when you claim for a refund without declaring a clause null and void. According to ECJ doctrine, a time limit for claims may be established in this case. However, the limit must be long enough to allow the affected party time to make their claim.

The ECJ sentence of June 2020 also mentioned this time-bar. The ruling last year said that the countdown for a claim deadline starts when the consumer is or could be aware of the possibility of making a claim.

Claimable Mortgage Expenses

Recent legislation has ruled that consumers may claim for refunds for the following mortgage expenses:

  • Notary fees – this expense should, by law, be divided equally (50% each) between the consumer and the bank. 
  • Property Registry fees – the bank should pay 100% of these expenses.
  • Paperwork fees (gestoria) – the bank should pay these expenses entirely.
  • Property valuation fees – the bank should pay these entirely.
  • Opening fees – the bank should pay these expenses entirely.

If you paid for any of the above expenses, you are entitled to claim a refund from the bank. Contact us to find out how.

Got a mortgage claim in Spain? Get in touch – we’re experts in making banks pay for abusive clauses.

What Happens Next?

The Spanish Supreme Court will make its own decision on the time-bar for claiming mortgage expenses on September 23rd.

At Costaluz Lawyers, we believe the Supreme Court will follow the precedent set by the ECJ. We will keep our clients informed on the latest rulings and how it affects their claims.

Need help with your mortgage?

To find out how our pioneering practice can help you get the refund you deserve, get in touch.

We look forward to helping you.

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