The Partido Popular (PP) has proposed that the future law for protection of mortgage debtors, currently in Parliament, should prevent banks from claiming the total amount of the debt until there are at least three non-payments of installments, which usually have a monthly regularity.
The current legislation establishes that any financial institution may start the claim of a total debt after only one non-payment, a period of time which will be increased to three in the new legislation presented by PP.
Another novelty within the text is the possibility of the judge reducing the debt once the eviction is in progress.
Magistrates will be able to condone the payment of the debt if the debtor pays 65% of the total pending sum in the fifth year after awarding the property, or 80% in the tenth year.
Should the institution that has taken over the property obtain gains in the ten years following the allocation, 50% of this profit, once expenses have been deducted, will be destined to reduce the debt of the mortgage holder.
With the aim of improving the transparency of the valuation processes of the properties, the new law will oblige banks to accept any approved valuation handed over by the customer. The financial institutions will not be able to have significant shares, either directly or indirectly, in the valuation agencies. (…)
Source: El Mundo