Spanish Ombudsman report on mortgages
03 February 2012
On 27th January 2012, the financial Ombudsman in Spain issued a report and conclusions on the current issues affecting mortgages in Spain.
This report is the result of the numerous complaints of mortgage holders when, due to the current financial climate, they struggle to repay and cancel the mortgages.
The report points out the many wrongdoings of Spanish mortgage lenders over the past few years and specifically during the property boom.
The main criticisms relate to the lack of clarity on the main financial terms and conditions and poor or non existent English translations available to those without enough knowledge of the Spanish language.
The Ombudsman firmly not only recommends but instructs the banks to rectify these issues.
However, most importantly, the survey addresses a recurring problem that affects most if not all the mortgages in default.
In Spain, repossession is undertaken without consideration of the value of the property at the time of repossession. The value used is that of the original bank valuation upon purchase.
So, if for instance a property is charged with a mortgage of € 100,000, but after several years the bank repossess the property and it is sold at public auction for, say, € 60,000 and the mortgage repayments over the years have reduced the balance by € 10,000, then the bank has the right to chase and claim from the mortgage holder the remaining balance which, in this example, would be € 30,000.
This means that, apart from losing their properties, the mortgage holders owe the bank a large amount of money. Also, it makes impossible to reach an agreement with the bank when the mortgage initially falls into arrears, as the bank will expect the property plus a lump sum to cover any shortfall.
The Ombudsman’s report clearly states that this system is completely unfair and abusive, as the banks take full advantage of the fluctuations, in many occasions dramatic, of the property market.
The report mentions several precedents from the Higher Court in Spain that recently (and increasingly) have observed this unfairness and have judged in favour of the mortgage holders. This has enabled mortgage holders to be released of their financial obligations by returning the keys back to the bank, and by doing so cancelling the debt in full.
The report also request that the banks include a clause in new mortgages that will allow settlement between bank and buyer, by returning the property to the bank, if at any moment the mortgage holder cannot keep on paying the monthly instalments. This clause is previewed already and available by law and can be claimed by new purchasers of real estate when buying in Spain.
Pasted from <http://www.rdtabogados.co.uk/news/articles/spanish-ombudsman-report-on-mortgages.aspx>
MINISTER CONFIRMS CLOSURE OF SAN JAVIER AIRPORT
Mark Nolan / 2011-11-18 17:05:31
The Minister of Public Works, Antonio Sevilla, and Secretary of State for Transport, Isaías Táboas have this week signed the official agreement that effectively sees Murcia San Javier airport closed to commercial traffic.
All passenger flights will now be transferred to the new airport facility at Corvera, in the heart of a brand new development area where the likes of the new Paramount Theme park will open and already a range of hotels and tourists attractions are being built, in the hub of a new and easily accessible road network.
Despite Murcia San Javier having a new runway built only a few years ago and the redevelopment of the airport terminal buildings, an investment that cost some 60 million euro, the airport at San Javier will revert back to being one of military status under the Academia General del Aire.
The document signed between the two administrations commits both parties to promote and support the actions necessary for the "rationalization of civil traffic, while respecting the legitimate interests of Aena airports as current airport operator and its employees at the airport of Murcia San Javier ".
Both institutions have reached agreement on the importance of aviation and air transportation to economic development in the Region of Murcia, as well as to meet the connectivity needs of citizens and businesses, according to the Autonomous Community.
The Ministry of Development has been entrusted with the guardianship of the national airport authority, Aena Aeropuertos SA, who is responsible for the operation and management of airport services at airports managed by Aena, as well as civilian areas of airports which are open to civilian traffic.
The Murcia government has granted administrative concession to AEROMUR for the construction and operation of the International Airport of Murcia, which were commissioned and scheduled for completion in 2012.
The agreement made has been as a direct result of a dialogue that was opened some months ago into the viability of airport operations once the new facility is ready to open.
Meanwhile, as construction work is almost completed, the Spanish aviation safety agency, AESA, has issued notice that they will be starting inspections for the certification of Corvera airport, which will lead to the creation of a full plan and strategy of testing and licensing the airport for commercial operations.
Once the inspection period has been completed, which is expected to take a few months, it will pave the way for real flight testing to commence, as well as numerous simulations before finally being certified as a fully operational airport in the summer of 2012
Article by the Laverdad (Spanish newspaper) 13 May 2010
The Government will cut the salaries of public employees this year and next will freeze going to remove the check-baby from 2011 and next year will stop raising pension contributions. These are the three main measures announced by the Prime Minister, José Luis Rodríguez Zapatero, in his special appearance in Congress, which has justified these actions to bring the deficit 3% in 2013. This effort, said Zapatero, is "special, unique and extraordinary" and should be done "right now" when they are seeing "signs" that show the beginning of economic recovery.
The first major measure announced by Zapatero is the average cut of 5% in the pay of public employees, who will be frozen next year. With this announcement, the executive breaks the agreement reached in September last year with the unions to raise salaries of public employees by 0.3% this year with a wage revision clause at the end of the year.
On 24 February, the Secretary of State of Finance, Carlos Ocaña, noted that he was considering revise the pact, though a second day after Vice President, Elena Salgado, we corrected and said he would respect the "one hundred percent" already broken this agreement. Zapatero has said that the salary cut will be proportional to income, ie affect more the higher wages, and also put forward that government salaries will be cut by 15%. Following this announcement the Casa del Rey also reported to apply in their salary / wage adjustments in line with those agreed for the corresponding levels of government.
The Prime Minister announced after being abolished with effect from January 1, 2011 called check-baby The provision of € 2,500 for the birth or adoption of a child. This feature, one of the measures 'star' of the socialist government's social policy, was also advanced by Shoemaker in the full parliament in July 2007, during the Debate of the State of the Nation, and became effective immediately.
Reduction of development aid
On the other hand, the government suspended in 2011 the pension increases, other than non-contributory and the lowest, which means that non-contributory next year will be updated according to the IPC. It also provides for the elimination of the transitional arrangements for partial retirement provisions of Law 40/2007.
This implies that only have access to that mode of retreat of over 61 years, with a minimum of 30 years' contributions to Social Security and at least six years old in the business, while only can reduce working time a 75% maximum.
The official development assistance by Spain also reduce 600 million euros between this year and 2011. The Government also provides that the Autonomous Communities and local authorities made a further saving of expenditure of 1,200 million euros.
Zapatero acknowledged that growth next year will be lower than planned to date, 1.8%. Although he admitted that recovery has begun, as evidenced by the quarterly growth of 0.1% recorded between January and March confirmed by INEThe Prime Minister has assumed that the recovery will be slower than initially estimated.
So far, the Government expected that the Spanish economy would register a fall still average 0.3% this year, estimating that Zapatero has not changed, and for the following estimated growth of 1.8%, although this was much more optimistic forecast that agencies like the IMF, the Bank of Spain or the European Commission. The first estimates the growth will be 0.9%, both the issuing bank manages Brussels expected figure of 0.8%.
The Chief Executive announced this package of measures to reduce the deficit after yesterday called the U.S. president to show his concern for the Spanish government through economic reforms and the European Union. After the conversation, the White House spokesman, Robert Gibbs, noted that Zapatero phoned Obama because Spain "have some issues on which it is necessary to ensure that reforms do not extend."
Aware of the impact that will have these measures, the president has admitted that the Government is not easy to decide the cuts, and has made no secret that his plan is "tough, but necessary." Even at the end of his speech has changed the target of his words, instead of the deputies have become citizens, which has demanded a great effort, one on one: "You are the column that holds the country. cargáis are the ones with their weight. "
The caucus 'popular' has not overlooked that the chief executive when he ended his speech, many socialists have not been put in place, like the rest of peers, while applauding. Alfonso Guerra and Francisco Fernández Marugán have stayed in his seat.
Rajoy attacked the "inability" to Zapatero
Filed measures, and in turn reply, the PP leader Mariano Rajoy, Has accused Zapatero of undertaking an "Great cut social rights' to accelerate the reduction of public deficit and regretted that his "inability" going to pay "all Spanish"Including pensioners and mothers.
This is "something that would not have happened" if the Prime Minister "had acted in time" and had followed the recommendations of the PP to not have to be the European Union that it "imposed" to cut "their" debt " , pointed Rajoy. So assured that, although the Government has accused the 'popular' social rights cut, never raised the PP what Rodriguez Zapatero announced today.
Rajoy Zapatero has asked to delete "immediately" third vice-president of the Government, remove and merge several ministries and to end subsidies "not justified" and other cuts, including those given to organizations, trade unions and policies.
According to leader of the opposition, these measures would prevent costs visited on pensioners, mothers and employees. "I also fall on you," has settled, despite which it has been willing to talk with Zapatero on his proposals. It has also warned the president that "no illusions to play" with the Spanish with the excuse of coming out of recession. 'The illusions at this point turn against you, "stressed the leader is popular.
The other opposition parties also have expressed their criticisms on measures announced by Zapatero. So, Joan Ridao regretted that the government be "strong with the weak, but weak with the strong", while Rosa Díez, UPyD spokesman has claimed to be patriotic Zapatero, the Spanish giving the ability to choose and call early elections.
The unions, Meanwhile, have been charged against the proposals and warned that could lead to new demonstrations. However, the general secretaries of CCOO, Ignacio Fernandez Toxo, and UGT, Candido Mendez, have avoided to pronounce the word general strike and warned that economic recovery will be delayed. Toxo noted that the measures "will deepen the economic downturn and introduce risks to make more job losses," and recalled that these initiatives must be added the increase in VAT from July and the withdrawal of 6.045 million euros of public investment. Candido Mendez also believes that the Government recipes represent "a failure of political discourse," the president and a "change of scenery in relations with the unions." Zapatero has said tomorrow at the two union leaders to give explanations. For now, the president already has the "active engagement" of the "barons" socialists to implement its plan of adjustment.