Spanish Off Plan Deposit Claims
Now, time is essential for a successful reclaim of your off-plan property deposit.
One of every five houses bought by foreigners in Spain, belongs to British Buyers; however, some of these buyers saw truncated their dreams, as they put their life savings into Off-Plan deposits for properties that were never built or that were never begun to be built. Since the Spanish real estate (bubble) crisis started in 2007, many developers and builders of these constructions have gone bankrupt due to the housing price falls and the bank credit limits to business and particulars that collapsed the Real Estate Market.
Developers, Cooperatives and Builders were obliged, under the Law, to finance these constructions hiring insurances from insurance companies or subscribing warranty contracts with banks that acted as guarantors of these constructions.
Affected clients who lost their deposits have now the chance to claim against banks and insurance companies and recover their deposits, according to the said Law 57/1968, 27 July 1968, which Article 1 says that: Constructors and Cooperatives (Developers) that promote constructions to be built off-plan and receive money from their clients (…) shall guarantee the amounts paid by their clients, plus the 6% annual interest by an insurance contract hired with an insurance company or by a bank entity (…)”.
In 2015, The Spanish Supreme Court ruled in 275/2015, 13th January 2015 against banks and insurance companies and held that they acted as guarantors of these off-plan deposits hence, as the developers became insolvents, they are jointly responsible for refunding their clients’ money.
Spanish Government passed a new law on 1st January 2016, limiting the liability of banks and insurance companies from the first construction license, and not from the off-plan projects.
Notwithstanding, If you lost your off-plan deposit prior to the passing of this new law in 2016, you could still reclaim your deposit, as this law enacted in 2016 is not retroactive. And remember, your statute of limitations are 15 years.
Del Canto Chambers offer you the chance to reclaim your Off-Plan Property Deposits. Let’s start with a free initial consultation of your case.
Please contact us for further information here.
Del Canto Chambers Spanish Lawyer in London