Recovering deposit paid for Spanish properties
British tourists at the end of the 90’s started to dream with a home in Spain. Banks were happily lending money to make the dream a reality and all seemed to be so easy. Spanish developers visited cities and towns to offer the excellences of Spanish properties making very easy its acquisition. As a consequence several hundred thousand properties were bought over the years in Spain by Britons.
The dream for many people became hell when dealing with off plan acquisitions and many told their horror stories to reality shows and yellow papers. Lot of media noise, frustration and certain aversion to buy in Spain growth, with a clear reason, among UK buyers of international properties.
The off plan acquisitions became very popular as the eternal capital growth myth seemed never ending. Several hundred million euros were paid as deposits, and some of them did not require a bank guarantee as established by Spanish Law.
As the global financial crisis hit Spain, the Spanish real estate market stop suddenly and many developers were unable to return the money advanced as a deposit of future construction. Many of them filed bankruptcy or became insolvent.
Some of these bankruptcy proceedings continue today, without the light at the end of the tunnel being visible through them, and without the affected buyers having recovered any money within the tunnel.
However, after many years, a different light begins to shine for all those buyers: The Spanish Supreme Court has been consistently ruling against banks on all the transactions affecting off plan acquisitions, establishing a sound precedent declaring the full responsibility of financial institutions, insurers, and in general, entities and solvent third parties involved in the acquisition process. The grounds to recover the deposits paid lays on a forgotten law dating back to 1969 Ley 57/1968 de 27 de Julio sobre percibo de cantidades anticipadas en la construcción y venta de viviendas where in a similar situation with a prominent developer the government issued legislation to protect consumers and making banks responsible for any moneys paid on account.
How will this affect clients who bought from AIFOS, Evemarina, Cogilcodos, Procusan, Alfamar, Grupo Mirador, Llanera and many others who defaulted to british clients?
There are now several sentences against Banco Popular, Banco Santander, Cajamar and many others asking them to return the money advanced by clients of developments in Spain such as Aifos Hipódromo, Hacienda Casares, Cortijo de Torreblanca, Euro Cam Beach, Terrazas del Jardin Nazari, to name a few.
The procedure can be started by Del Canto Chambers and starts with an initial free consultation to assess the case. The client must provide the existing contracts and payment documentation, as well as any expenses incurred for said acquisition.
Claudio Rodríguez Vera (@rvclaudio)
Abogado en Del Canto Chambers