Great news for anyone who lost out after paying an advance on a proposed Spanish property build between 2005 and 2016. Thousands of people, attracted by irresistible real estate projects in Spain, stumped up for property developments in touristic areas that ultimately never saw the light of day; many developers went bust leaving purchasers with no dream holiday home and no refund of the deposits paid in advance.
The good news is that hope is in sight for many of the would-be Spanish holiday home owners affected. Until recently, Spanish courts had followed different criteria regarding the liability of the guarantor banks over deposits paid. However, more recent court decisions ruled in the home buyers’ favour, allowing them to recoup deposits paid whether they were paid in cash or into a bank account.
The practice of paying deposits to developers was of course the norm prior to the economic crisis in 2008, and back then few predicted the catastrophic consequences that could arise in the future. While developers may have washed their hands of the situation, it’s great news that banks are nonetheless responsible for payments made to developers.
What you need to do.