We continue to collect the fatal inheritance left by the real estate boom. On the occasion of numerous and recent judgments at national and European level, what many of us claimed is confirmed: the Bank cannot always win and there must be mechanisms to control the bad practices that financial institutions carried out years ago.
The famous floor clauses, expense clauses, early maturity clauses, late payment interest clauses and multi-currency mortgages are concepts with which we have already become familiar.
Multi-currency mortgages are an instrument that is represented as a mortgage loan subscribed in euros, although its equivalent is specified in the chosen currency (usually in Swiss francs or in yen), and the payment of its installments is not made in euros, but in the referenced currency.
This question assumes that the mortgage debt varies depending on the fluctuation experienced by the chosen currency and this, in relation to the price of the euro. This circumstance, at first attractive, meant that during the financial crisis of 2008 onwards, the mortgage payments that consumers had to attend to soared due to the devaluation of the euro in relation to the chosen currency.
In our legislation there is freedom of agreement with the only limitation that said agreements, reflected in a contract, are not contrary to the law, morality or public order.
This issue was transferred to our courts, and was addressed for the first time by the Supreme Court, through its Judgment of November 15, 2017, pointing out the following fundamental issues: the clause that establishes the referencing of the mortgage installment to foreign currency it must pass transparency controls.
Likewise, said transparency control must be reinforced, that is, not only must the multi-currency clause be expressed with grammatical clarity, but consumers must be able to foresee the consequences of its application.
The Supreme Court indicates that the multi-currency mortgage is a complex product because of the “It is difficult for the average consumer to understand some of its risks ”. This means that consumers must be provided with information on the risk they assume for contracting this product, since, in the event of a devaluation of the euro, the mortgage payment can skyrocket.
This information, or documentation in the vast majority of cases, does not exist, and it is the bank who must prove that it made it available to consumers, therefore, given the impossibility of proving it, any claim regarding the nullity of the clause.
Therefore, we move on to the point on what all consumers who see the multi-currency clause included in their mortgage loan should do and what they can obtain in case of claim its nullity.
Every consumer may request the recalculation of the capital loaned in euros, the recalculation of the installments paid also in euros, and that the capital pending amortization is the difference between the capital loaned in euros and the total amount paid (capital and interest) for its equivalent value in euros, with a reduction of the mortgage payments at the Euribor interest rate plus the differential established in the deed.
If it does so, the consumer will see a significant reduction in both the outstanding capital and the payments that must be paid in the future.
To resolve these issues, we recommend all those who may be affected by a multi-currency mortgage to go to a professional to study the viability of the claim and to proceed, without further delay, to claim their legitimate rights.
Antonio Pastor Pérez, lawyer and partner of Círculo Legal Barcelona
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