Has a bank refused your mortgage application because your name appears on a creditor’s list? Have you found that you couldn’t expand your personal loan because of a debt in your name?

All too often, customers discover that their name and personal details feature on a creditor’s list for a debt that they had no knowledge of. The good news is that if this situation affects you, you could claim thousands of euros as compensation.

Here we’ll look at how to apply for compensation for wrongful inclusion on a creditor’s list. 

Why am I on the creditor’s list?

Like all European countries, Spain has associations that keep track of people’s credit records. Banks and other lending entities check this record when you make an application for a loan, whether it be a large mortgage or small personal credit.

In many cases, you only need to default on one payment, subscription or direct debit – and this could be for a small amount such as a monthly phone bill – and creditors will start to pursue the debt. This is particularly true of companies who outsource their debt collection.

In some incidences, you may satisfy the debt and think no more of it. In others, the debt may not be justified – for example, your telephone company wrongly charges you for a service they did not provide. Or an electricity company continues to bill you after you change to another provider.

In both cases, there is the chance that the debt collector will add your name to the creditor’s list.

Did you know? CostaLuz Lawyers are pioneers in obtaining compensation for their clients from banks. Find out more here.

What are the consequences of wrongful inclusion on a creditor’s list?

If you’re thinking about compensation for wrongful inclusion on a creditor’s list, the chances are that you have already discovered and suffered the consequences. The most common negative impact is that a lending entity refuses to give you a loan, however small because your name appears on the creditor’s list.

You may have found that several entities reject your loan application on the grounds of a poor credit record. And the bottom line is that you may be unable to get credit from anywhere.

If this is the case and you are unaware of any debt or have always paid debts off in the past, the reason is probably because you’re on the creditor’s list.

How do I find out if I’m on the creditor’s list?

The best way to find out if your name is on the creditors list in Spain is to consult the National Association of Credit and Financial Institutions (Asociación Nacional de Establecimientos Financieros de Créditos/ ASNEF). The association brings together all financial entities and specialised credit companies in Spain and maintains a list of creditors. 

You should contact the ASNEF by email or regular mail at the addresses provided here. Quote a reference number if you have one and include your full name and NIE. The ASNEF has one month to reply. 

Did you know? Your name can be included on a creditor’s list for debts as small as €50. In many cases, the debt is questionable and the consumer may have appealed against it. 

What are the grounds for compensation for wrongful inclusion on a creditor’s list?

If you discover that you do appear on a creditor’s list and feel that the grounds for this are unjustified, you first need to make sure that you qualify for compensation.

What are the conditions for eligibility when claiming compensation?

You can only apply for compensation if you fulfil the following conditions:

– There is a real debt that you have not paid.
– You have received no formal notification of the debt and/or have not been asked to pay it off by the company you owe it to.

Right to honourable reputation:

In most cases, wrongful inclusion on a creditor’s list is regarded in law as a breach of your right to privacy and damage to your honour as an individual. The fact that your name appears on the list without your knowledge implicitly violates your reputation. Your name may have been on the list for years causing a considerable impact on your credit record.

Spanish law recognises this scenario as moral damage and you are therefore entitled to claim compensation. You may also claim for economic damage.

How much will I get?

The exact amount varies for each concept: moral damage and economic damage. For the former, the judge takes into account factors such as how long your name has been on the list and how many companies have consulted your details. Compensation for moral damage generally starts at €2,000.

The amount you can claim for economic damage depends directly on the monetary consequences for you as a result of being on the list. For example, if a bank rejects your loan application because you appear as a bad creditor and you lose a business opportunity, compensation will equal the lost opportunity. Note that you need to provide documentation that proves economic loss.

How do I apply for compensation?

When you seek compensation in excess of €2,000 you generally require the services of a lawyer and court representative. They take on your case and in the first instance, negotiate directly with the company who included you on the list. Out-of-court settlements are common, although many claims do go to court. 

At CostaLuz Lawyers, we are more than used to helping clients claim compensation from banks and other entities. We have helped dozens of customers receive a reimbursement and have an excellent record of success. Contact us now for a free consultation and to find out whether you qualify for compensation for wrongful inclusion on a creditor’s list.
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