 The infamous “Ground clause” (Clausula Suelo)
is declared null and void for being abusive
Banks to give money back to their clients after the infamous “Ground clause” (Clausula Suelo) is declared null and void for being abusive. This will mean an important and immediate saving over the term of the mortgage.
The first sentences have been granted, declaring the so-called “ground clause” - a minimum interest rate that financial institutions apply to many mortgages in order to insulate themselves from possible declines in the Euribor –null and void.
By means of this clause the banks apply a minimum interest rate, despite the fact that the interest rate governing the mortgage is lower.
The sentence pronounced by the Mercantile Court number 2 of Seville declares these clauses null and void for being abusive; specifically the ones applied by the following banks BBVA, Caixa Galicia and Cajamar, since April 12th, the “ground clause” can no longer be put into effect.
All of this could be a chance for those mortgage holders who may have been paying this minimum interest rate, to proceed to demand the refund of the extra money charged. In most cases this would mean thousand of Euros, as well as the disappearance of this minimum rate over the rest of the term.
As a consequence of the said sentence, the affected bankshave requested from the judge an extension of the 2 month period granted in order to give the money back, on the grounds that managing the refund of the extra amounts charged is a “complex process”.
Despite the sentence, the three banks, BBVA, Caixa Galicia and Cajamar, have insisted on the fact that the “ground clause” is a “legal practice”.
Nevertheless the banks will not make any refund unless the client demands it. Any client who wishes to have the refund process started will have to take legal actions.
In the case of BBVA the “ground clause” established a minimum interest rate for its clients of 2, 5%. In Caixa Galicia the minimum was 2, 75%, while in Cajamar 3, 25%.
The evident unbalance between “grounds” and “ceilings” imposed by these banks (BBVA-12%, Caixa Galicia-10% and Cajamar-15%), has been the main reason why this sentence declared these unfair clauses null and void, as they meant a profit for the bank without any reciprocity that could benefit the consumer.
IT’S NOT THE ONLY ONE
This sentence, passed last January 26th and that came into effect on April 12th, is not the only one to declare “ground clauses” as abusive. Last March, the Mercantile Court number 1 of Leon sentenced Caja España to remove the “ground clause” of its mortgages and to refrain from using it in the future, a fact which led to thousand of mortgage loan holders to benefit from important reductions in their following monthly repayments. In the sentence against Caja España, the judge underlined, in addition to the significant unbalance between “ground” and “ceiling”, Caja España’s bad faith to include and impose this clause as part of the general terms and conditions, without allowing the client any possibility of negotiation.
If you think this could be your case and would like to have your personal situation analysed, please do not hesitate to contact Manzanares Lawyers in order to start the corresponding actions to obtain a refund of the monies you have been wrongfully charged by your bank. Furthermore you will be able to enjoy a lower monthly repayment in the future. |
