To walk or not to walk ?
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Help me out.
I bought an off plan property through capital eyes 3 years ago, put down a £20k deposit. The property was then valued at 180k Euro's as so I could get the mortgage sorted on a place which was being sold at a 145k Euro's
The place is in Vera and is not attracting the kind of rents I was expecting or promised and now the interest only period is over the mortgage is over 900 euro's a month and with a long term rent I cannot hope to achieve more than 450 Euros a month.
Now I could afford to make up the shortfall if it was rented by that is not happening and I can't afford to keep topping up my Spanish account with £700 every month.
There are properties going up all around our development advertised for from anywhere between 120 - 140 k and they look similar so the chance of selling at a suitable price are nil
I've tried to speak to my bank who have said all they can tell me is that if I missed 3 months worth of rent they will start proceedings to take it to public office.
I'd be happy just to hand the keys back and cut my loses but I'm worried that they will then sell my place at public auction and because the current market situations in the area they will get a minimal price for it leaving a massive balance for which they will chase me in the uk for.
Is there any benefit that the bank valued the place at 180k euro's and the fact that was way above what it should be? Or could it work in my favour the bank that they valued it at 180k I've got a mortgage of 125k euro as so handing back the keys is the best option for both parties?
Any help is greatly received.
Regards
Jon
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My sympathies for your unenviable position. I'm afraid that no-one here can help you....only the bank you borrowed from. I suggest you speak with them in the strongest terms and try and negotiate some sort of breathing period. But don't hold your breath. This is Spain and the inability to pay your mortgage is certainly not viewed sympathetically. In effect you took a gamble...and lost! The whole financial system would break if the "little" people just walked away from their debts. No-one forced you to sign. And the banks will pursue you and your family till it's paid. The desert around Las Vegas is littered with the shallow graves of those unable to pay their debts, buried by the money men, who, just like your bank, have to make an example to keep this system in order. I suggest that you examine your insurance policy, and then have someone level the place with a JCB, whist you're out of the country (there are lots of unemployed construction people around).
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The whole financial system would break if the "little" people just walked away from their debts
Can anyone say sub prime?
Now here's the real kicker in America, it's not the illegal immigrant who bought a McMansion who's defaulting the average employed Joe who's walking away. I expect the same to happen in Spain. I've also noticed an interesting phenomenon in American message boards. A few years ago when a story like lomas was posted the comments came fast and cruel. Today there is a lot more sympathy as the housing mess engulfs the American middle class.
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Decided after all I don't like Spanish TV, that is having compared both.
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That's it. The stupid, arrogant, consumer crazy, must have a Rolex and a Range Rover middle class are the real culprits here. All the dinner table talk of how much my house has gone up in the last month....and now, because they have greater access to media, we have to hear their shrill bleating for sympathy. The poor and the rich live within their means. This just shows how shallow and selfish those midde class aspirations really are.
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must have a Rolex
Does my fake Rolex from China count 
If you have time here's a very interesting lecture on the shrinking US middle class (bu tlessons are relevant to the rest of us)
http://needtobedebtfree.blogspot.com/2008/09/coming-collapse-of-middle-class.html
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Decided after all I don't like Spanish TV, that is having compared both.
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I believe that if you have difficulty in paying your mortgage, the bank is obliged to allow you to extend the term in order to reduce the monthly payments, without charging you to set it up. I think you need to speak to them about it before falling into arrears.
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Dear Lindie:
Banks are not obliged to the extension of the repayment period, but they do it as a general rule..of course they prefer having their earnings than a house to be auctioned.
Best,
Maria
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Maria L. de Castro, JD, MA
Lawyer
Director www.costaluzlawyers.es
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Lomas subject to who the lender is they may take the keys back. There are certainly some who are offering that solution but much will depend on lender and circumstances. before anyone mentions the value in relation to the loan I am aware of a similar situation where the loan exceeded value and the lender made the offer. Just be careful that you understand the full implications of what you are doing and everything is put in writing if they accept - if they agree you dont want a knoc on the door in three years time...... On that note new EU directives now permit a lender in Spain to pursue in country of residence for repayment on debts - again subject to circumstances whether they would follow this route is I guess debatable. If they dont have a legal team in the UK it would probably get very costly in lawyers fees so perhaps they would consider it not worth the fuss -. then again if they have to chase enough pèople would it justify setting up a permanent team on economies of scale basis. Lenders here that have a UK presence may decide its worth it to them but for others maybe not. The question is whether they would chase someone over a shortfall on a 120,000E mortgage having sold at auction - if the loan was much larger then I have no doubt they would justufy the legal cost but on a small one who knows?
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Smiley - patrick@marbellamortgages.com www.marbellamortgages.com www.comparetravelcash.co.uk
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