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If you have a mortgage in Spain, it may be affected by floor clause

There is a chance that many of you who have signed a mortgage with a bank during the last decade have probably done it through mortgage floors clause, which is considered as null and void since 2013 by the Spanish Supreme Court.

The floor clause (clausula suelo) is a clause, which in included in the majority of mortgages, which basic structure is that the lender, for example, BBVA, puts a limit on how low the interest rate can fall to.

This means that no matter how low the Euribor (the rate on which mortgage rates are based) falls, the customer must always pay the interest back at the fixed minimum interest rate.

Therefore, anyone, whether consumers, businesses or self-employed, who have signed a loan contract should review them and see if there is a clause whereby the lender, usually a bank, ensures the payment of minimum interest. Normally the percentages  are set approximately at 3% -5%.

You may asking yourselves the following questions:

  • How and where?

To find out if you are affected by a floor clause, you can contact us and we will review your mortgage free of charge. For this we will need your loan records and the notarial deed. You are eligible to claim if you contracted a mortgage in the past 15 years or so.

  • What are the banks concerned about?

Initially, 45 financial institutions were being sued by customers, but this has now risen to almost 100. Here are some of them : Banco Popular, BBVA, Caixa, Sabadell, Cajamar, Caja Canarias, Caja Duero, Sabadell Atlántico, Unicaja, La Caixa, Banca March.

  • Do I have opportunities to win if I claim?

Yes, the vast majority of the claims, some media talk about more than 90%, are won. Even if the floor clauses are legal, banks have not adequately informed consumers and therefore the conditions passed on by the Spanish Supreme Court for its validity are not met. Thus, they are declared void.

You can recover the overpaid amounts and get a reduction on your interest

  • Is it worth to apply?

YES. If you don’t claim, there is a very good chance the bank won’t eliminate the clause and you will lose the chance to reclaim the overpaid amounts.

  • What happens if the bank accept to remove the clause in order to avoid litigation, shall I accept?

Be careful, because banks would do anything to avoid the removal of the abusive floor clause. Furthermore, if the bank does remove the floor clause (upon your request), you will then not be eligible to claim the overpaid amounts. Keep in mind that you have a great chance to win the claim so don’t hesitate to go after it!

If you find yourself in this situation, please feel free to contact Lexland and one of our qualified lawyers will help you recover a significant portion of the interest paid, on average up to €15,000!