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The Pandora's Box was opened by a Supreme Court ruling on 18 October 2018. The floor clause, traditionally assumed by customers, was going to be paid by a financial institution. Changes were coming and days of uncertainty arrived… ¿ the sentence was going to be retroactive? How would the banks' accounts be affected? Finally, and in the face of so many doubts on the table, the Supreme Court decided to freeze the application of the ruling and to convene the full court.The final decision stated that it was the client who had to pay this tax, but later, the Government approved a decree law in which it modified all the previous laws and obliged the banks to pay this tax, without retroactive effect, which would have meant an important blow to the banks' accounts.
In parallel to all this, the processing of the future mortgage law has been going on, and after three years of delay, everything seems to indicate that this coming March the regulation will come into force. Some of the changes that will be introduced in the new law are:
Some of the changes are as follows
The costs will be shared at the moment of formalising a mortgage: This means that the lender will have to assume all the associated costs, except for the appraisal, which will be the responsibility of the borrower.
The number of months of non-payment required to execute a mortgage contract, which is the previous step for an eviction to take place, has been raised. From now on, if the non-payment occurs in the first half of the loan, the months of non-payment must be 12 months or 3% of the capital, while if the non-payment occurs in the second half of the loan, they can reach up to 15 months or 7% of the capital granted thereafter
The number of months of non-payment must be increased to 12 or 3% of the capital, while if the non-payment occurs in the second half of the loan, they can reach up to 15 months or 7% of the capital granted thereafter
The number of months of non-payment must be increased to 15 months or 7% of the capital.
Contracts pending judicial resolution will not be affected. Reduction of interest for late payment: in order to compensate for late payment of an instalment, interest will be payable at the interest rate, instead of the legal interest rate, plus three percentage points.
Reduction of fees for early repayment of a mortgage. They will be eliminated from the fifth or third year, depending on what the different parties agree, with a maximum cost of 0.15% or 0.25% respectively, for variable-rate mortgages. Whereas, for fixed-rate mortgages, the early repayment fee will be 2% if it occurs in the first ten years, and 1.5% thereafter.
The interest rate that can be charged for changing from fixed to variable for a mortgage is modified to 0.15%.
All these changes are in addition to the possible rise in the euro, which closed 2018 at -0.129% after the fourth consecutive month of increase since September of the same year. All these changes are in addition to the possible rise in the euríbor, which closed 2018 at -0.129% after the fourth consecutive month of increase since September of the same year.
That is, although the figures of the years of the real estate boom are far behind us, we cannot deny the evidence that 2019 is going to be a great year for the real estate sector and the best time to sell your home or buy a new one. Don't forget that at Unicasa&Home we will be delighted to help you throughout the buying process. Stop by one of our offices or call us and our sales advisor will answer all your questions.