Thursday 8 November 2018

Mortgage Tax and Costs


A lot has been said over the last three weeks regarding the costs and taxes associated with a mortgage in Spain. The following is from the Money Saver Spain website and is worth a read.

Spain's Supreme Court decided this week, in a reversal of their initial decision, that it should be the client and not the bank that pays the tax when taking out a mortgage.

Consumer organisations, amongst others, are outraged. It was hoped that the Supreme Court would maintain their original decision but without backdating it, thereby removing the possibility of an avalanche of claims. 

The Government has announced that they will rush through a change in the law for all new mortgage clients making banks responsible for the tax payment. But banks are expected to make mortgage conditions less favourable for new clients.

Now it remains to be seen what will happen when the case is taken to the European Court of Justice. When this happened with the mortgage "floor clauses", the ECJ sentenced in favour of clients and the Spanish Government had to set up special courts to deal swiftly with the 1000s of claims made by those affected.

For anyone who has already made a claim against their bank regarding mortgage arrangement fees, you may still be entitled to the return of other costs. However companies that took on cases on a no-win, no-fee basis may now not be willing to take on new cases as the tax made up the largest part of the claim.

More info in this article in English from El PaĆ­s.

If you need any help or advice regarding property in Spain, contact us now on +34 966 112 773 or email barry@ultimatehomes-spain.com

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