What abusive clauses can a mortgage contain? How are they claimed?

The economic crisis of 2008 uncovered the bad practices of the banks related to mortgages.

Thomas Osborne
Thomas Osborne
20 October 2022 Thursday 04:48
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What abusive clauses can a mortgage contain? How are they claimed?

The economic crisis of 2008 uncovered the bad practices of the banks related to mortgages. The contracts included aspects such as the floor clause, the opening commission or the collection of other expenses that the banking entities actually have to pay.

Over the years, cases have been discovered in which these bad practices cost consumers money and place them in a position of vulnerability that, on occasions, violates their rights. In 2021, claims to banks increased by 61%, with more than 34,000 files to claim mortgage loans and other financial products.

The General Law for the Defense of Consumers and Users establishes that abusive clauses are those that have not been negotiated individually with the consumer, as well as all those practices not expressly consented to, that go against good faith and cause a significant imbalance of the rights and obligations of the parties to the contract. In this case, to the detriment of the consumer.

Any clause included in a mortgage that was not explained to the client, that is not worded in a concrete, clear and simple way and/or that causes damage is an abusive mortgage clause.

The types of clauses that are abusive and those that may involve abuse:

In recent years, Spanish and European courts have annulled some of the clauses that banks regularly included in mortgages.

If a mortgage includes an abusive clause, the client can claim in three ways. On the one hand, complain to the bank's customer service to demand the elimination of the clause and the return of what has been overcharged for its application. Banks have a month to respond, although the most common is that their response is negative.

The other option is to go to court. If the judge considers the clause abusive, the bank will have to remove it from the contract and return what has been unduly charged. This route is slower, since it can take months or years to have a ruling and the bank can file appeals.

Finally, extrajudicial agreements are also common. In these cases, a legal expert advises the affected party and reaches an agreement with the financial institution.