El blog de Maria

Keith said:
Wednesday, March 7, 2012 @ 1:46 PM

Also the Spanish Government should bring in new measures to eliminate the Cláusula Suelo from all mortgages. This clause is abusive and is keeping the interest rates on many mortgages at artificially high levels.

This is costing many Spanish families and overseas homeowners in Spain lots of extra money each month in overcharged interest.

In my mind this abusive clause is similar to the PPI mis-selling issue in the UK. It should be dealt with by the Banco de España or Spanish Government and all banks should be forced to remove the floor limit, recalculate all interest paid and refund the amounts charged under the abusive clause.

In many cases the floor limit was set at around 4.25% and the upper limit, which was intended to protect consumers was set at around 11% or 12% and sometimes higher.

Since its inception in 2000 the Euribor has never exceeded 6% and for long periods has remained between 1% and 2%. Therefore, the floor limits and upper limits set by the Banks created a significant imbalance and were of a clear detriment to the consumer. This is a violation of good faith as these clauses were biased and totally in favour of the Banks.

The floor limits were restrictive and detrimental to the consumer and the upper limits which were designed to 'protect the consumer' were set at a level which were on most occasions more than twice the level that the Euribor has ever reached.

The Euribor is currently around 1.70%. So on a mortgage sold as Euribor + 1% you should be paying an interest rate of 2.70%. The Banks 'sold' the mortgages with headlines such as Euribor + 0.5%, Euribor + 1% etc. This was their main selling point - Euribor plus a low differential. The Cláusula Suelo was never mentioned and only included in the small print. A clear case of mis-selling.

This is just another abuse of the buyer and home owner in Spain.

Kind regards

Keith