What happens when you are no longer able to pay your mortgage in Spain?

More and more can no longer service their mortgages due to unemployment. 1.8 million families in Spain, all members of unemployment line. Most are Hispanic families, but also foreign families end up in disability , and Norwegians are no exception. What happens when you are no longer able to service your mortgage ?

After three months of unpaid loan installments , the bank can go to court to claim money from the borrower if the borrower does not show any intention of paying the loan. If there is no agreement between the borrower and the bank, sent the case to the legal department to prepare the auction of the property you have pledged in. What many do not know is that , unlike other countries , is not of the auction house synonymous with eradication of debt. If no one bids on the property during the auction , which is quite common today , the bank will “buy” property for 60 % of the property value. If this percentage does not cover the entire amount of the loan , the borrower will be left with debts to the bank. If the borrower earns more than 1,000 euros a month , the bank will confiscate the excess amount. In the worst case, one that is homeless , but with debt and seizure of wages .

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Before it goes so far are the best to sit down with the bank manager and arrive at an affordable repayment plan. You have got to be completely open about the problems , so that the director also gain an understanding of the problem and your situation . Banks are not interested in more homes in their crumbling housing portfolio and is very manageable when it comes to finding solutions to the benefit of both parties . What to ask your bank ?

1.Karantene ( carencies the capital ) . This means installments : that in a period of only paying interest . In this way, the monthly costs are reduced by up to 50 %.

2.A rigorous quarantine , where you pay a minimum amount of interest . This variant is difficult to achieve , but should for safety reasons discussed with bank director.

3.If one does not have the option to pay either principal or interest, should the accommodation offered for sale with a price equal to the loan size.

4.Dación one pago . This is a scheme that can be used when all other options have been tried. This arrangement gives the borrower the opportunity to hand over property to the bank, against the bank renovate all debts including legal fees, municipal taxes , public spending and housing tax. To make use of this solution , the borrower must meet certain requirements. The borrower must be in a precarious financial situation. The monthly expenses must exceed 60 % of salary. Housing loan must apply to borrowers’ own homes . In addition, the purchase price of essential character , ie how much of their time paid for accommodation :

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Maximum 200 000 euros in cities with more than a million inhabitants .
Maximum 180 000 euros in cities with more than 500 000 inhabitants .
Maximum 150 000 euros in cities with more than 100 000 inhabitants .
Maximum 120 000 euros in cities with less than 100 000 inhabitants .




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