Recover your money now: lawsuits against financial institutions can be filed in order to recover the amount paid on stamp duty
In accordance with the latest Supreme Court ruling on the 16 October 2018, the case law takes a 180-degree turn, enabling over 6 million affected homes to file lawsuits against financial institutions and recover the amount paid on stamp duty.
Who can claim?
The main step is to claim back the expenses paid as a result of setting up your mortgage, directly from your entity. If the entity refuses the application, you can take legal proceedings in regards to the nullity of the expense clause stated in your mortgage.
It is important to keep hold of all invoices such as the notary, land registry, administration, valuation and, above all, form 600 for the stamp duty on property transfer, to determine and claim the amounts paid when signing the mortgage.
Does my mortgage have this clause?
It is important to review your mortgage contract, even in the event that your mortgage has already been paid. You must look for a clause (such as this or similar):
“They are the exclusive account of the borrowing party for all taxes, commissions and expenses incurred in preparing, formalizing, rectifying, processing the deeds, modification-including division, segregation, or any change involved which implies alteration of the warranty – and execution of this contract, and for the payments and refunds derivatives thereof, as well as the establishment, maintenance and cancellation of all guarantees, also being in its charge the premiums and other expenses corresponding to the insurance of damages, which the borrowing party is obliged to have in place …”
What kind of expenses are we talking about?
The Supreme Court has considered that there is an unfair imbalance between lender and borrower. It is therefore understood that it is abusive, since it is the consumer who assumes all of the expenses, when the bank already has its own guarantee.
The expenses include:
- Constitution before a notary.
- Registration in the Property Registry.
- Payment of the Tax on Documented Legal Acts and Transmissions.
- Notary expenses for the Mortgage deed.
- Invoice of taxes for the property.
The regulation that protects the consumer, in article 89.2 of the General Law of Consumers and Users, also considers that clause abusive.
How much money can I get back?
The amount to be recovered will vary according to the percentage of the tax rate that was applied at the time of signing.
Looking at a mortgage worth 150,000 euros, you could have paid between 1.000 and 4.000 euros on stamp duty, depending on the Autonomous Region. Add to this the notary, registry, administrative and valuation fees.
What documentation is needed to start the claim?
The following documents are needed:
- Deed of the Mortgage.
- Receipt of payment of the Mortgage.
- Invoice of the Notary.
- Invoice of the Registry.
- Letter of payment of the taxes.
What is the process to claim back my mortgage expenses?
Due to the ruling being very recent, there are still some loose ends which need to be confirmed, regarding the process to claim back the expenses paid. Although the nullity of the expenses clause in the mortgage deed must be claimed against the entity, the final refund of the amount paid on stamp duty may have to be claimed before the Tax Agency.
If this is indeed the final process, it would mean that ONLY the borrowers who signed their mortgage less than six years ago will be able to claim back the stamp duty before the Tax Agency.
What is my next step?
Awaiting confirmation of the Supreme Court ruling, being firm, until the 5 November, no details will be confirmed regarding the basis for a claim.
If you are in doubt, we advise you to get in touch with experts lawyers to find out at which step of the process your claim currently is, and whether you have the possibility of claiming back your mortgage expenses, and, above all, the stamp duty.
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