Tenerife Cabildo information session about clausulas suelo and mortgage costs court rulings

[Janet]

This will be of interest to anyone with a mortgage with a Spanish bank.

Recently, there have been judgments by the European Court of Justice nullifying mortgage floor clauses (clausulas suelo – please see my post HERE) and mortgage set-up costs liability – where banks charge mortgagees all the fees and set-up costs in addition to the actual mortgage. In the light of these rulings, the Tenerife Cabildo's Centro Insular de Calidad y Consumo Responsable (Centre for Quality and Responsible consumerism) in La Laguna is holding a free information session for the public this Wednesday, 11 January, from 5 – 7 pm (17.00 -19.00).

This meeting is intended to explain the scope of the ECJ's judgment of 21 December that sentenced Spanish banks to repay all monies overcharged on account of these clauses. As such, it will offer information so that the public can inform itself as to what, if any, professional help could usefully be engaged, a matter of concern to quite a few right now because many seem to have been approached by a range of "professionals" (even lawyers, notaries and land registries) all seeking to be engaged to try to recover monies which may or may not be due for repayment.

The meeting will be held in collaboration with Adicae, the Association of Users of Banks, insurance and financial services. It's a major and generous provision by the Cabildo, whose councillor for employment, commerce, industry and economic development, Efraín Medina, said "we at the Cabildo are trying to shed light on the new situation so that all those here in Tenerife who are affected by these judgments can benefit from the advantages of the rulings".

Obviously this meeting will be in Spanish, and I don't know that an English translation will be on offer – or even practical to provide. For those who wish to attend, however, the Centre is at C/ San Agustín 15. 38201 La Laguna: I've put a map below with a star indicating the end of the tram stop.

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[Janet]

There was such interest that the small room booked for the numbers expected was nowhere near the size needed. The meeting was therefore held more than once, and another date will be scheduled for questions and answers ... I will have a report in the next day or so, hopefully next few hours, from a source that will be rather familiar ...

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[Janet]

From my website:

Nova Howard, ex-Santander employee and now qualifying as an asesora, was at the meeting. Her report is HERE, and reproduced below, and I comment underneath it the points to which I myself would draw particular attention:

This evening I attended a public meeting in La Laguna, held by the Tenerife Cabildo's Centro Insular de Calidad y Consumo Responsable (Centre for Quality and Responsible consumerism) in collaboration with the consumer protection organisation ADICAE, to provide information about the recent European Court Judgment which ruled that the "clausula suelo" is abusive and that affected mortgagees are entitled to a full refund of costs, regardless of whether this clause was obscured or not.

The meeting began with a brief explanation of the cláusula suelo (floor clause).  This is a clause imposed by banks in an estimated three million mortgages throughout Spain, whereby the interest rate paid by the customer, although tied to the Euribor (European base rate) is limited from falling below a minimum rate (the floor) even when the base rate falls.  The speaker explained that this became an issue in 2009, when the base rate tumbled following the financial crash.  Bank customers who expected their mortgage interest rate to reduce accordingly found that it did not, and as a result ended up paying far more for their mortgage than they should have.  This clause has now been determined by the courts to be abusive, as well as costs charged to the customer as part of arranging the mortgage.

The speaker detailed the costs that customers are entitled to have refunded and emphasised that a procedure for obtaining refunds is not yet in place, but that the procedure, when one is found, will be universal (available to all those affected), fast, free of charge (with no unnecessary costs for lawyers and other professionals who would view the claims as a business opportunity) and will not require individuals to pursue their own legal action.

Mortgage-related costs that citizens are entitled to have refunded:

* All extra interest they have paid due to the cláusla suelo;
* Notary and escritura costs;
* Land registry costs;
* Gestoría costs charged by the bank;
* It was noted that the right to refund of document tax related to the mortgage contract is unclear at present as the courts have not been unanimous on this.

It was also clarified that, in the case where the customer has signed a waiver at the request of the bank that renounces their right to any refund in the event of such a court judgment, for which many banks offered incentives, this document itself is considered abusive and will not affect the citizen's fundamental constitutional right to have their monies returned.

Since there is as yet no procedure in place for claiming refunds, the advice at present is to just wait, as ADICAE will inform the public as and when there is more information.  They also invited attendees to join their association which has already represented some 15,000 of those affected in a class action against the cláusla suelo.

Unfortunately, the organisers of the meeting had grossly underestimated the interest it would generate and, instead of the two hour meeting with Q&A session advertised, the presentation was cut short after forty minutes so that it could be repeated twice more for the crowds now gathered in the lobby because the room assigned was far too small.  As such, I am sure that many of the points above invite questions and clarification which was not possible this evening.  ADICAE urged anyone wanting more personal advice on the matter to visit their office in Santa Cruz at C/ Juan Rumeu García 28, Office nº.12 on the second floor, on Wednesdays and Fridays between 5pm and 8pm.  They also promised to hold a second meeting for the Q&A session sometime in the next week or two.  I intend to go to this meeting and will gladly ask any questions on behalf of those who request it.

So, despite the (almost certainly deliberate) misinterpretations and attempts to fudge by some banks, it is clear that the mere existence of a clausula suelo in a mortgage is enough to warrant a claim for a refund for illegally overcharged interest. As Nova has said: "it's the clausula itself that is abusive, not the way it was imposed".

Also, as I suspected and argued HERE, anyone who was persuaded by their bank to waive their rights in return for some inducement has now been confirmed to have been a victim of yet further abuse. There are rights you just can't sign away, let alone under duress, or when conned, and anyone who signed a renunciation letter cannot be bound by it.

Finally, despite the incredible rush of offers from all types of professionals to put in claims for refunds, the formal Banking Users Association ADICAE says that there is no procedure yet in place for claiming refunds. The official advice is DO NOTHING, AND WAIT. The association will itself inform the public as and when there is more information. Most importantly, anyone affected and who has a claim has no need whatsoever to pay anyone to help them. Just join ADICAE, and wait to be informed in due course about whatever procedure will be used for claims ... but which ADICAE already says will be available to anyone affected, streamlined, and free of charge.

[Nova]

It was quite amazing how drastically they had underestimated the numbers.  There were probably around 60/70 people squeezed into the room for our presentation, as you can see in the pic many of them were standing.  Just before it began, one of the organisers announced from the doorway that the Q&A part would have to be postponed to make way for a second sitting after us.  After around 40 minutes the same gentleman appeared at the door again announcing, with panic in his voice, that even more people had turned up and there would be two more sittings, and he couldn't kick us out fast enough!  The presenter had started handing out membership forms for the ADICAE association but the other gentleman was calling, begging him to stop so that people would go away and he could get the next shift in 

As we walked out of the building the whole lobby was jam-packed with hundreds more people wanting to be informed.  To be honest I'd be surprised if they weren't there until midnight giving repeat performances!

[Janet]

There is still no date as yet for the next ADICAE meeting, but the association has today said that it is important to be aware that the refunds process will not be immediate and that a little patience is required, both in terms of getting money back, and of becoming aware of the procedures to follow. The association says that the banks have one month from now to create a department to attend to those affected by a cláusula suelo and then three months to return any claims that they receive.

Meanwhile, ADICAE is currently studying the small print of a Government decree to determine the procedures to follow and will advise shortly. It is also setting up an Observation Control to monitor the banks' offers for return funds – which suggests that they expect some banks to make settlement suggestions to avoid legal action. The association suggests individuals affected register HERE so that they can be informed personally and directly by the association itself without the need to involve any expense.

[Marion]

How do I know if I am affected?  Just by trying to read the small print of my mortgage contract?

[Janet]

There will be specific clauses in your mortgage concerning interest rates. That is where the clausula suelo (floor clause) will be if you have one ... it's odds on that you do.   

[Janet]

ADICAE has provided HERE a form to allow people to calculate the amount they will be able to reclaim. You will need your mortgage details in order to enter the information needed.

[Janet]

The second meeting which was promised after the first was over-subscribed will be held tomorrow afternoon between 5 and 7pm. Again it will be in the Centro Insular de Calidad y Consumo Responsable del Cabildo in La Laguna (but one hopes a bigger room ... ).

[Marion]

Can't find my mortgage papers. Hopefully I have them filed in Tenerife.