BANKS who overcharged mortgage-holders through so-called 'minimum interest clauses' have been ordered to refund the difference dating back to May 9, 2013.
Although many homeowners who have been overpaying for much longer are disappointed with the Supreme Court verdict to this effect, it does in fact mean a partial victory for those who have been fighting through legal channels for some time now.
Spain's president Mariano Rajoy (PP) has announced 'minimum interest' or 'ground' clauses will not be permitted in any future mortgage contracts, and already, many judges have annulled them on the grounds they are 'abusive' or overly advantageous to the lender at the borrower's cost.
With the Euribor, or Eurozone interest rate having been in free-fall for some years, after historic hikes throughout the year 2007, a number of homeowners discovered their mortgage contracts had 'ceiling clauses' and 'ground clauses', meaning that whatever the Euribor did, their monthly repayments would never go above a certain interest level – but also, that it would never go below a stated minimum.
Whilst these clauses were a source of comfort to mortgage-holders in 2007 when the Euribor was pushing 6%, after it fell to 0.5% and then 0.25%, they found that they were still paying considerably over the odds.
'Minimum interest' clauses were declared null and void on May 9 two years ago, unless the borrower's attention had been expressly drawn to them before signing and he or she had given express consent to this.
Any overpayment of interest since the clauses were voided can now be automatically reclaimed.
And the mere 'reading of the terms of the contract in front of a notary' when the mortgage agreement was signed is not considered sufficient for the customer to have been deemed to have 'fully understood' the implications of the 'ground clause', the Supreme Court judge has said.
The Supreme Court has rejected appeals by the BBVA and Cajasur against the annulment of these clauses.
Read more at thinkSPAIN.com