Bank Guarantees

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This topic contains 63 replies, has 15 voices, and was last updated by Profile photo of Anonymous Anonymous 10 years, 5 months ago.

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  • #51832
    Profile photo of Anonymous
    Anonymous
    Participant

    I understand the concept of Bank Guarantees – just not how they work in real life.

    This report on another site shows how difficult it is to actually implement these guarantees.

    http://www.viva-almeria.com/modules.php?name=Forums&file=viewtopic&t=3203

  • #62374
    Profile photo of Anonymous
    Anonymous
    Participant

    I am currently buying in Cuevas de Almanzora area in Spain (not ACC) and have in previous posts explained our plight.

    I have another question regarding Bank guarantees, because of the on going problems and lack of licence for our house, I contacted our solicitor and asked her to confirm the bank guarantees were in place this is the reply I got back :

    Regarding the bank guarantee, it can be granted, but the expenses for it have to be paid by the client. So in case, you would decide to have bank guarantee to cover the paid amounts, you would have to pay for it.

    Is this correct? We stupidly assumed we already had them, although we hadn’t actually seen a copy . Daft eh?

    So if any one can clarify the situation I would be really gratefull.

    Awhale 😳

  • #62380
    Profile photo of mariadecastro
    mariadecastro
    Participant

    The Bank guarantee is an executive title that you can bring to Courts and recover your amounts fast, in an executive procedure.

    The Aval Bancario ( Bank Guarantee) or Insurance were both stablished by a 1968 Law to protect buyers in off plan developments.

    Art. 1.- The developer must guarantee the devolution of the deposited amounts plus 6% of annual interests rate, through an insurance contract or by bank guarantee, for the cases when the construction doesn´t start or doesn´t finish in the agreed time.

    They also need to open an special bank account for your amounts (
    different from the general one of the developer) and have it expressly in the contract.

    Art. 2º.- In those contracts where the parties agree on anticipated
    amounts , the develper must expressly state:

    a) That the developer will give back to the buyer all the advanced
    amounts plus the 6%, in those cases where the construction doesn´t
    start o doesn´t end in the agreed deadline, or the certificate of
    habitability is not granted.

    b) Reference to the bank guarantee or insurance contract ,
    ndicating the name of the Bank or the Insurance company.

    c) Specification of the Bank or financial institution and the account number where the buyer´s money is deposited .

    At the signature of the contract, the developer will give to the buyer
    the document that contains the guarante ( the aval or the insurance
    contract) and the document must have a reference to the amounts that
    need to be anticipated.

    Art. 3.- Once arrived the deadline for starting or finishing the works and not having them either started or finished, the buyer can choose between cancelling the contract with the devolution of advanced amounts plus 6% annual rate, or to concede a time extension, wich will be stated in an additional clause in the contract, specifying the new deadline with the date for finishing the construction and completion.

    The insurance contract or the bank guarantee together with the docuement that fully prove that the works has not been started or the completion deadline has been met and not complied, will have executive power as it is stated in the Title XV of Book II of Civil Procedure LAw, to demand from the insurance company or the bank, the amounts that the buyer is entitled to ask for,

    Without prejudice of any otner given rights also applicable.

    So, ask for guarantees before any amount is given and have is as an executive title to get your money back from the Courts in a very fast way ( executive titles).

    Maria.

  • #62381
    Profile photo of mariadecastro
    mariadecastro
    Participant

    You don´t have to pay for the bank guarantee. The developer has to provide it. By Law.

    Maria

  • #62386
    Profile photo of Anonymous
    Anonymous
    Participant

    Maria, we are exercising our BG and we were told only a few days ago by our lawyer that we will not get 6%, it will be in the region of 4%. Apparently it depends on the bank rate?? 😕

  • #62390
    Profile photo of mariadecastro
    mariadecastro
    Participant

    The Bank Guarantee needs to cover, according to Law, all the handed amounts plus 6%. Obligatory. If not, they are offering to you an illegal compensation.

  • #62392
    Profile photo of Anonymous
    Anonymous
    Participant

    Thanks Maria. I will take this up with our lawyer.

  • #62398
    Profile photo of Anonymous
    Anonymous
    Participant

    Thank you Maria for your reply.

    I am going to get onto my solicitor and speak to her and mention the 1968 law and that the developer should provide it.

    Everything is a battle , we feel so let down by the system.

    Still keep smiling things can only get better (I hope) 🙄

    Thanks again much appreciated

    Axwhale

  • #62399
    Profile photo of Anonymous
    Anonymous
    Participant

    Be careful with the percentages…

    There has been some kind of controversy about this point from 1999 when General Building Act (Ley de Ordenación de la Edificación) was approved as it contains an additional rule, the ‘disposición adicional primera’ that some of us think modifies this 6% stating the ‘legal interest’ instead… today the 4%

    Cesar

  • #62403
    Profile photo of Anonymous
    Anonymous
    Participant

    😕
    So our lawyer is correct in his 4/4.5%, Cesar. …We don’t want to upset him!! 😉

  • #62405
    Profile photo of mariadecastro
    mariadecastro
    Participant

    If there is no written agreed percentage, I would gently go for 6%, and if the developer don´t concede I will low it down to the legal interest of money, wich is 4% in 2006. But… that is just my way of working , which has enough legal coberture.

    I understand Cesar point of view too, of course.

    I am flying to Marrakech tonight to assist a real estate sale there. I can´t wait to see how the system is in Morocco.

  • #62406
    Profile photo of mariadecastro
    mariadecastro
    Participant

    FYI:

    http://www.reicaz.es/normaspr/tablasdi/tbldiner.htm

    This is a scale of the legal interest of money over the last years. First column where stated: ” Interes legal del dinero”

  • #62407
    Profile photo of Anonymous
    Anonymous
    Participant

    Last Years Spanish Legal Interest

    YEAR / LEGAL INTEREST

    1999 / 4.25
    2000 / 4.25
    2001 / 5.50
    2002 / 4.25
    2003 / 4.25
    2004 / 3.75
    2005 – 2006 / 4.00

    Cesar

  • #62408
    Profile photo of Anonymous
    Anonymous
    Participant

    Sorry Maria, I was posting and I din’t see your previous

    Cesar

  • #62409
    Profile photo of mariadecastro
    mariadecastro
    Participant

    It is OK Cesar. It seems we are synchronized or take aim at the same.
    Thanks Cesar.

  • #62412
    Profile photo of Anonymous
    Anonymous
    Participant

    It was originally 6%, albeit as César highlights it’s fixed by the anual interest rate whih the Oficial Gazette (B.O.E.) publishes every year. It’s currently 4%.

    I never get 6% back. It’s roughly between 4-4.5%.

  • #62832
    Profile photo of Anonymous
    Anonymous
    Participant

    I am in the process of cancelling my ‘off plan’ contract, as completion is well overdue, and my solicitor says the current rate of legal interest is less than 2%.

    Is he definately wrong?

  • #62840
    Profile photo of mariadecastro
    mariadecastro
    Participant
  • #62842
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi Maria,

    I can see where you are coming from in saying people should get 6% interest. In all our correspondence starting with our original lawyer who signed our purchase contract, we were told that we would have 6% interest paid on our 30% deposit. In reality this is not the case. 👿 The court in Madrid made a judgement against the bank to pay us within 10 working days. The rate of interest we are getting is between 4% & 4.5%. This does not cover our legal and other expenses incurred. We will have to take another (expensive) court action to recover this, although as there are several of us in the same boat, we are considering a class action. It is a matter of principal for all of us especially as some people were paid with no interest being given at all, because they needed their deposit returned ASAP, and could not be doing with court cases.

    The Bank in Madrid has to pay today or appeal. I’ll let you all know the result.

    The court ordered this payment on May 25th. The Bank has 10 working days in which to make the payment from the date of notification to them by the court. When we were told this at a meeting with our lawyer on May 30th, my husband asked if/when the bank was notified. Apparently they hadn’t been notified 😯 : 🙄 🙄 : This was confirmed by an e-mail awaiting our return from holiday last Monday saying the Bank had 10 working days in which to pay up …..as of the 1st June!!!! Watch this space!

  • #62844
    Profile photo of Anonymous
    Anonymous
    Participant

    I have e mailed my lawyer again saying that I have read the current legal interest rate is 4%.

    ( please see my earlier post about withdrawing from an ‘off plan’ purchase, as the developement is overdue)

    His response is;

    [The rates vary according as to whether the interest is applicable under the terms of article 1801 of the Civil Code (delays in fulfilling an obligation) or as to whether you are engaged in proccedings already or as to whether you engage in transactions with the government or between companies.
    If we reach a private agreement with them we will request not just the 4% but the 5% rate as per the last Budget Spanish Law. if we have to threaten them with proceedings and we initiate them the courts will only grant around 2% depending on the type of negligence or damage they determine. That is what I meany when I said that it was a low interest.]

    My knowledge of Spanish law is almost nothing. I need to know if his explanation, (above), seems reasonable or is it not reasonable?

    My ‘off plan’ purchase’ was through OE and the salesman introduced me to the lawyer. The lawyer has been very efficient so far, but until now I have been proceeding in the right direction, ie, towards a purchase.

    I would appreciate any opinions from legal advisors on this forum please. If I need to change lawyers, the sooner I know, the better.

    [/quote]

  • #62847
    Profile photo of mariadecastro
    mariadecastro
    Participant

    @Claire wrote:

    Hi Maria,

    I can see where you are coming from in saying people should get 6% interest.

    Claire:

    I don´t know what you mean with that. I am sorry. Where do I come from?

    Regards,

    Maria

  • #62855
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi Maria,

    Sorry, it’s an English expression.! What I mean is “I understand what you are saying and why you say it” It is difficult to explain it. 😕

    regards,

    Claire.

  • #62856
    Profile photo of Anonymous
    Anonymous
    Participant

    Hello Maria

    I bought off-plan “without guarantee” as told “I didn’t pay for it” ❗ I now know this is an illegal clause 😡 but my question is:

    Would my 30% deposit still HAVE to be held in a ‘protected’ bank account or is it possible (due to illegal clause) that the developers have been able to use it to fund their continued building of future projects / or whatever else they want to ❓

    Many thanks

  • #62858
    Profile photo of Anonymous
    Anonymous
    Participant

    Suzanne, from our experience, these deposits are NEVER held in escrow accounts. The builder has, as in our case, used the funds for his own”bank rolling” Hey! it’s cheaper than getting a bank loan!!!

    Our developer got in the region of £6,000,000 pounds in deposits for our top level blocks of the development…which they never built, and they’ve had it for three years in most cases. Now their lawyer says they cannot afford to pay back the money with interest to those whose lawyers did not get a BG!!!!!!! 😈

  • #62864
    Profile photo of Anonymous
    Anonymous
    Participant

    Many thanks Claire. How dare they ❗ Can’t the Judge ORDER them to pay your compensation plus legal costs etc ❓ Surely they will be fined heavily by the Court too.

    Best Rs.

  • #62868
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi Suzanne –
    I’m in the same development as Claire (or rather the development-that-never-got-built).
    What you ask seems to be logical, just and only right.
    However, unfortunately the system doesn’t work as simply as that.
    We first have had to claim on our Bank Guarantees through the court because despite completion being end of Sept last year, they put the date to call in the BG for end of Sept. this year.
    The developer’s argument is: What is the problem? You will get your money next September?!
    We, like Claire, went out to Spain to try and get our money back from the developer, only to be fluffed around with comments like ‘we can’t afford it right now, we have had many expenses like agents’ commissions, printing brochures etc. etc.’
    The only concrete offer we ended up having (after three trips!) was a return of our money without any interest – ‘because we want to help you’. (!).
    Three year interest-free loan? – can’t be bad if you can get away with it!!!

    We refused and went to court with the BG on the grounds that nothing has been built, nothing will be built – why should we wait any longer?
    The judge ruled end of May that the bank must honour the BG (with legal interest), and that they have ten working days to pay or to logdge an appeal (!)
    If we do get our money back (with the paltry interest) – there is no compensation whatsoever involved.
    This we have to do in a separate court case – stressful, time-consuming and obviously costs money lawyer-wise.
    And of course there are no guarantees.

    However, that is what we are doing, however long it takes, because we are sickened and angry that this developer should get away scot-free.
    Claire and my situation has taken it’s toll stress-wise, but feel that however long the ‘compensation’ case takes, besides the financial side of things – it will help us lay to rest some of the anger and worry that this particular rogue developer has caused.
    The developer is involved with another development now (probably financed in part by £6,000,000 of our monies!) and we hope that some of the publicity featured in newspapers in UK and in Spain about them re. our cases may help prevent them creaming in yet more money from unsuspecting buyers.
    As far as we are concerned, what they did is nothing short of theft and the directors of this company deserve more, in my book of honour, than a couple of compensation cases.

  • #62869
    Profile photo of Anonymous
    Anonymous
    Participant

    Suzanne –
    sorry, meant to add, re. your case, that BY LAW, all developers selling off-plan have to issue a Bank Guarantee (at no cost to you).

    If you still do not have one, contact your lawyer asap and demand that the developer issues you one.
    However, be careful that the Bank Guarantee date matches the date of completion as per your contract.
    They may try the same trick as with Claire and myself where they give a BG date one year later than completion (our original ‘rogue’ lawyers didn’t bother to pick up on this). It is illegal to do that, but can end up causing an unnecessary problem if you need to call in your BG.

    Don’t worry, the law is on your side on this one, your developer is legally obliged to issue you one and know they are seriously breaking the law if they don’t or try to delay.
    Good luck!
    Charlie

  • #62870
    Profile photo of Anonymous
    Anonymous
    Participant

    Firstly, a big welcome back to the forum Charlie – we’ve missed you !
    We also bought in the same development as Charlie and Claire, however, our bank guarantee matures on 31st July this year. The developer recently offered us a cheque for our deposit but no interest – some cheek after almost 3 years !! 😈 Needless to say we did not accept. Our lawyer approached the bank to execute our guarantee but was told that they would not entertain us before 31st July despite an obvious no build. My question is ‘what exactly is the procedure when that date arrives ? ‘ (we are not getting a very clear answer from our lawyer). 😕 Perhaps Maria you would be so kind as to clarify things for us – is it simply a matter of presenting the guarantee and evidence of no build to the bank and they will pay or do we need to go through the court system ? Do banks usually pay up when requested on maturity of a bank guarantee or do they tend to dispute and delay ?Has anyone on this frorum actually been repaid money on the basis of a bank guarantee ? Thanks for your help.

  • #62871
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi Mary –
    nice to ‘be back’ now we finally have some sort of internet connection.
    We are sad to ‘lose’ Spain, but are very happy on our Greek island!

    Re. your question, can only contribute that when we put the same question to our lawyer last year, the answer was yes, banks do try to ‘dispute and delay’. Banks do not just pay up on the day stated on the BG (even if they agree to pay). Apparently it is several weeks plus before the money comes through.
    Just passing on what we were told re. this particular point.

    Re. your last question – keep your fingers crossed for us for Monday, and we’ll let you know!
    best wishes and ‘Good Irish Luck’, Mary 😉

    Charlie

  • #62872
    Profile photo of Anonymous
    Anonymous
    Participant

    Many thanks Charlie – have sent you a PM.

    The latest is that the developer is returning all certified mail from my new lawyer unopened ❗ ❗ Very interesting that my previous lawyer apparently didn’t have that problem.

  • #62877
    Profile photo of Anonymous
    Anonymous
    Participant

    Charlie

    you may have seen similar posts about Miraflores?

    i havn’t got my completion date (any day now) but have just been informed by our spanish lawyer that no bank guarentees were ever issued and as part of our contract says we must complete with or without a habitation licence and then pay the developers 900e for temporary sercices ubtil the habitation licence comes through, and if we dont complete when requested by the devopers, we will lose everthing!

    nice one eh?, they are flouting the law, so what? no one will protect us!

    David.

  • #62878
    Profile photo of Anonymous
    Anonymous
    Participant

    David, did you get my pm re lawyer? I am having a great deal of trouble with the SPI website since our return from holiday. It takes forever to come through. It could be the “extreme” Norton anti virus we have recently installed I guess. 😕

  • #62879
    Profile photo of Anonymous
    Anonymous
    Participant

    Maria in a previous posting you said

    “The insurance contract or the bank guarantee together with the docuement that fully prove that the works has not been started or the completion deadline has been met and not complied, will have executive power as it is stated in the Title XV of Book II of Civil Procedure LAw, to demand from the insurance company or the bank, the amounts that the buyer is entitled to ask for”

    We have a bank guarantee that matures on 31st July covering a deposit we paid on Santa Maria Green Hills almost 3 years ago. Our property should have been completed last October but nothing has been built – we have notarised photos showing no build. My question is what do we need to do when the bank guarantee matures. Is it sufficient to send the notarised photos to the bank- our lawyer has said he will also request a Certificate of Completion from the developer and give them 3 days to send it on (which they obviously can’t do as there is no build). Do you think the bank will pay out on this evidence or do people usually need to go to court to enforce their guarantee even when it has reached maturity date ?

    Thanks for your help
    Mary

  • #62880
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi Claire

    no we didn’t get it, if you could send it again that would be great, we will keep an eye out for it and check our ‘spam’ folder, as our anti-virus gets a bit over enthusiastic as well!

  • #62882
    Profile photo of Anonymous
    Anonymous
    Participant

    Claire,

    I did receive the details of your lawyer via. pm. Thank you very much!

    I did send another pm. to ask if they speak english. Me espanol esta muy poco!

    David

  • #62894
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi David, They speak very good English…compared to our Spanish!! 😀 I did not recieve your last pm though.

    A little while later 😉

    I did receive your last pm. 😳

  • #62898
    Profile photo of mariadecastro
    mariadecastro
    Participant

    Mary and all:
    My apologies for this late response. Very busy these days

    Is there a clause like this one in your bank guarantee?

    “solidariamente, a primer requerimiento y con renuncia a los beneficios de previa excusión”.

    ” jointly and severally, at the first request and waiver of the right of excussion”

    That would be direct, but it depends on what your aval says.

    You will need to send a legally unquestionable request to the bank, with enough evidence of the failure to comply by the developer.

    If money is not back then , you will have to go to Courts in an executive fast procedure.

  • #62904
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi Mary
    We probably have the same worded Bank Guarantee (from Banco Popular Hipotecario) as you. We have seen copies of quite a few of the other purchasers, and they are all identically worded except for the dates.

    You will probably see two dates on yours – the 15th July, and the 31st July.
    The first date is the date by which the developer must provide the ‘Certificate of End of Works’.

    Because they won’t (which they obviously can’t as you rightly say, not having built anything), you have to bear in mind that you then only have from the 15th until 31st July to claim.
    Officially, after the 31st July, your Bank Guarantee has expired!

    So what must happen is your lawyer must submit (preferably on the 16th)
    1) The Requerimiento Notarial – with notarised photos of the plot showing the no-build
    2) The formal request in writing for your money to be paid with legal interest as per the Bank Guarantee (your lawyer should probably send this by buro-fax – like a registered letter – from the post office for proof of posting and delivery).
    3) Probably copies of your original contract/ your passport etc.

    If your lawyer is good – he should know exactly how to go about this, but the important thing is the timing.

    I really suggest, Mary, that you telephone your lawyer now, make sure he hasn’t forgotten, hasn’t got you filed away somewhere, is not going to be on holiday etc. etc. so he is fully aware about the move that has to be made once the 15th July has passed.

    Also, if I were you, liase with your lawyer about the possibility of you being out there for the day this is done, so if the Bank try to throw anything up, you are on the spot to deal with it.

    As we are not lawyers, but passing on info. we have gathered over the last months – suggest you check all of the above out thoroughly with your lawyer.
    Let us know if you get no joy, and I’ll see if I can get more clarification from our current lawyer.
    Best wishes, Charlie

  • #63028
    Profile photo of Anonymous
    Anonymous
    Participant

    hello all

    we apparantly, never had a bank guarantee issued (aifos build) i have only recently found this out from our current lawyer in spain (agent recommended).

    When i phoned our first lawyer in england (agent recommended) they said aifos never offer bank guarantees and it was up to our agents to arrange one, which we now know never was!

    Several posts on here have said it is a legal requirement by the developers to arrange one, so who’s telling the truth? and who do we claim against for not having one?,

    Now we wish to not complete due to loads of problems with the site, and still not finished after 4 years, it would seem our deposit was never protected,

    any advice anyone?

  • #63038
    Profile photo of Anonymous
    Anonymous
    Participant

    Sounds like you entered into your contract to purchase some time (4 years or more?) ago? Maybe the current Ley de Ordenación de la Edificación (LOE) [Building Act] which made these guarantees compulsory wasn’t in force then?

  • #63040
    Profile photo of Anonymous
    Anonymous
    Participant

    hillybilly

    no, that’s not the case, it’s even written all over the front page of the promo’ booklet, supplied by the agents at the start, which thankfully we have kept!

  • #63041
    Profile photo of Anonymous
    Anonymous
    Participant

    Sounds like you need a new independent lawyer to fight for YOU!

  • #63152
    Profile photo of Anonymous
    Anonymous
    Participant

    just confirming, that aifos never issued a bank guarantee, despite it being the law? and our agents or lawyers never told us this either, i only found out when i asked my lawyer about claiming back our £30,000 due to various breaches of contract at miraflores.

    If you are in the process of buying, make sure yours is in place, we have been mislead in to believing we have always had one for the last 4 years, and now we are in a mess, and seeking advice on what to do next?The law on the CDS, i think is changing, due to all the corruption, but at the moment it still just seems to benifit the people in the wrong with the most money, against those of us working within the law just to get justice!

  • #63172
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi goodstich44

    So far as I understand, in 1968 the law re BGs was instituted to protect people (like us) buying off-plan so that if the developer defaults you can claim your £ back. BGs are required by LAW and are free. They are NOT arranged by agents but should be provided by the developer. When my previous lawyer (ME) told me I wasn’t covered by the Bank Guarantee because I didn’t pay for it he was lying to me. I changed lawyers (highly recommended/independent) and now am being kept fully in the picture and have started lawsuit against developer (now in jail by the way). Who knows where that’s going ❗ ❗ Developers can be fined very heavily by Court for not providing BGs.

    If your lawyer is hedging, wasting time or not telling you the truth it is imperative you change immediately. It’s very likely their main concern is to work in the developer’s interests if that is the case. They are not going to change overnight and become reputable. You deserve much better and only a good lawyer who tells you the truth can help you. All the best.

  • #63174
    Profile photo of Anonymous
    Anonymous
    Participant
    goodstich44 wrote:
    If you are in the process of buying, make sure your Bank Guarantee is in place, we have been mislead…….

    When you say you were ‘mislead’ – do you mean you were verbally told you had one, or do you have anything in writing from your lawyer or developer that made you believe you had one?

  • #63175
    Profile photo of Anonymous
    Anonymous
    Participant

    @Suzanne wrote:

    Hi goodstich44

    So far as I understand, in 1968 the law re BGs was instituted to protect people (like us) buying off-plan so that if the developer defaults you can claim your £ back. BGs are required by LAW and are free. They are NOT arranged by agents but should be provided by the developer.

    This is exact. It’s free, its compulsory under law and it comes all the way back from 1968, nothing new. And the interest rate currently is between 4-4.5% per annum. Whoever tells you the contrary is either ignorant or has vested interests. Everybody is entitled to protection and your lawyer should se to that.

  • #63177
    Profile photo of Anonymous
    Anonymous
    Participant

    Draken

    thanks for confirming that, our lawyer has confirmed we have no bank guarentee, but has offered no solution? and that aifos have breached our contract on two main issues

    1- the apartment is 23% smaller than contract size

    2- it took 4 years to build instead of two, which i assume if we had a bank guarantee we could have claimed on?

    according to our lawyer we have just two options, neither which sound very good to me,

    1- not to pay any extra money and sue aifos for breaching the contract

    2-to complete and sign the title deed and then sue at a later stage

    We really are stuck, we don’t want to risk losing our life savings £30,000,
    but we dont feel, as aifos have broken the contract, why we should have to pay the full amount on a site with many faults including a sewage in the local stream planning issue, and no habitation lience, but our lawyers have said twice, that aifos will not accept any claim or any reduction on price!

    we are getting advice from wwwtherightsgroup, so all is not lost yet, but our completion date is expected any day, so we will have to make a decision soon,

    our agents, oceanview, are advising us to complete, on the basis that we will at least have an asset, as oppose to losing our £30,000 deposit.

  • #63178
    Profile photo of Melosine
    Melosine
    Participant

    Hardly an *asset* more a *mill stone* if the paperwork never materialises thereby another illegal build.
    Your lawyers are obviously in cahoots.

  • #63179
    Profile photo of Anonymous
    Anonymous
    Participant

    our agents, oceanview, are advising us to complete, on the basis that we will at least have an asset……….

    Goddstich44 – this is untrue. As I said before, without the licence of first occupation/habitation, YOU CAN NOT LEGALLY REGISTER THE PROPERTY IN YOUR NAME.

    The bank who funded the development have first claim on it in the scenario that Aifos go under and can dispose of your apartment.
    By completing, the developers have your money, but the bank still ‘owns’ your property.

    Drakan – as a lawyer, correct me if I am wrong?
    Nice to see you are still around, by the way. Regards from Sofia 😉

  • #63180
    Profile photo of Anonymous
    Anonymous
    Participant

    charlie,

    thanks again for what could be very valuble info’

    oh dear oh dear, if thats true, it just takes us back to what everyone is saying apart from ocean view, ‘don’t sign without the habitation licence’

    It seems the only fair solution would be to have our £30,000 back with interest, and compensation for 4 years of worries and lies, or delay completing until the habitation licence is issued, but our lawyer says aifos will not accept any delay, not accept any reduction on price or accept any claim against them!….if that’s due to our contract, why have we got such a crap contract?

    with no bank guarantee, what chance of getting our £30,000 back also?

    we are considering changing lawyers, but apart from spending a load more money, will it make any difference on the end result i wonder?

  • #63181
    Profile photo of katy
    katy
    Spectator

    Article in Sur yesterday said that the Dirección general de consumo de la junta de andalucía have issue fines to many promoters/developers. Some of the fines were for issuing contracts with abusive clauses, misleading publicity, no FLO. So it would seem you can take out a complaint with the consumers office. So it would seem you could let AIFOS know that you know about this. Your lawyer sounds rubbish, I would get another asap.

    The consumer dept. also states that complaints against developers are 21% higher than the same period last year.

  • #63195
    Profile photo of Anonymous
    Anonymous
    Participant

    @charlie wrote:

    The bank who funded the development have first claim on it in the scenario that Aifos go under and can dispose of your apartment.
    By completing, the developers have your money, but the bank still ‘owns’ your property.

    Hi Charlie. This is exact. Regards to both you and Sofía.

    Aifos, Aifos, Aifos …. 😯 never cease to surprise me.

    No LFO no home virtually. No bank is going to loan you money against that property, you cannot hook up regular supplies of water , electricity and the likes. A complete nightmare. Meanwhile Aifos buys a 40 million euros hotel. Business as usual (Aifos style).

    Hi Goodstich44, If your property is 23% smaller than what you’ve actually signed you must calculate (i.e.your lawyer) the price of the m2 and deduct the proportional ammount (taking into account that terraces have half the value than roofed floor).

    E.g. Say I sign for a 80 m2 200k flat. Roughly thats 2500 Euros per m2. Now If the developer “mistakenly” decides to hand me over a property whose size is in fact 23% smaller (that is 18.4 m2) I, the lawyer, will deduct upon completion 18.4 times 2500 Euros which is 46.000 Euros less. And obviously the 7% VAT corresponding to that amount.

    I’ve done it for 10 m2 never more. Now I’m simplifying because to calculate this is a tad more complicated and you would need a chartered surveyor.

    The problem is If your lawyer is willing or not to put on fight on your behalf. Aifos has in fact breached your contract. And IIRC If the difference in size of a property is more than 10% you can in fact recover all your money back wihout any kind of penalistion on your part because they’ve breached the contract so there’s just no need to complete. I’d have to look up the article but in your case 23% is a clear breach which just cannot be challenged at court and any lousy lawyer knows it. Play hard, play to win.

    If you don’t complete the REAs don’t get a commission from the developer, Aifos that is. So they have a vested interest in you completing or advising you in this way.

    Your lawyer should focus the case in this manner. No need to start lenghty and unnatainable court procedures. It’s that simple really.

    1. You complete and practice a proportional retention 23%=m2

    2. or else your lawyer declares breach of contract and recovers your money.

    If 4 years have already gone by and the property isn’t already finished, AIfos breached the contract a couple of years ago already. It’s not the contract that’s crap, it’s your lawyer. You are entitled to a full refund plus 4-4.5% interest rate per annum. Nevermind the 23% difference !!!

    N.B. Your lawyer is dozing off. Change him immediately. And NEVER EVER complete without a LFO, no lawyer can possibly recommend you to do this, it’s a big no-no. And If one does you can bet your life he’s in bed with the REAs and with the developer, money , money 😈

  • #63200
    Profile photo of Anonymous
    Anonymous
    Participant

    quote Drakan:
    Hi Charlie. This is exact. Regards to both you and Sofía…….

    You were our teacher….. 😉

  • #63204
    Profile photo of Anonymous
    Anonymous
    Participant

    Drakan,

    thank you for any help you are able to offer, we are becoming concerned about the advice from our lawyers (recommended by the estate agents)

    after reading charlie’s post about us not being the legal owner because we cant register in our name without the habitation licence, i asked our lawyer today, and he seems not to agree?, (see his answer below), what do you make of it?, by the way i was very pleased with your answer regarding our situation with the breaches of contract and build time delays and habitation licence. although our lawyer has said we could refuse to complete and sue aifos, all he keeps telling us is that aifos will not accept any negotiation on price or accept any claim agaist them, and i dont think he is prepared to try, i cant get an answer from him about why we have never had a bank guarantee either, and why he has never alerted us to this?

    The information we are getting from our lawyer is that our situation is fairly hopeless for us, unlike the information we are getting from you or charlie, it’s all very confusing. I think you are right, we must fight this and not let aifos get away with another rip off.

    Our lawyer said to me, ‘why are you questioning my advice, i am on your side’…….

    it just does not seem that way to me at the moment?

    David.

    Dear Helen and David,

    According with the Spanish Law once you have signed the Title Deed upon completion, you are the freehold owner of the property.

    Again the Habitation Licence it has to do with Mijas Town Hall. Therefore the answer is YES, upon completion you will be the register legal owners.

    Best regards.

  • #63206
    Profile photo of Anonymous
    Anonymous
    Participant
    Drakan wrote:
    [ It’s not the contract that’s crap, it’s your lawyer.

    David,

    You won’t often hear one lawyer decry another!

    You’ll get nowhere until you dump your lawyer. Just tell him he is history…it’s that simple!! I gave you contact details of another lawyer!! The ball is in your court.

  • #63213
    Profile photo of Anonymous
    Anonymous
    Participant

    I am confused about the BG issue still, our solicitor said to us when I pointed out we hadn’t got a BG or even seen a copy of it that if we wanted one “it can be granted but the expenses have to be paid by the client so if we wished to have one we would have to pay for it”

    Does that mean we would be paying for them to get us one from the developer?

    Also we are having trouble with licence etc we put deposit down in Oct 2003. The properties are finished and we were told by our solicitor that the developer said we could go in now, quote: we could go into the house after paying the final payment.! Thanks to this site we have obviously not done this as there is no licence. Our developement is waiting on decision from the Junta of Andalucia apparantly our solicitor told us that the builders had licences when they started work and doing the buildings but after that it changes, the classification of the land changed into non urbanizable and that means cannot be built on. It would have to be changed back to make things legal.

    IS THIS RIGHT ? CAN THEY JUST CHANGE THE CLASSIFICATION OF THE LAND? Or is it the case of the builder/ developer telling lies in the beginning.

    Its all so frustrating nearly three years down the line and nothing .
    What would be the outcome if the Junta didn’t give permission for the land to be made urbanizable which is a worry as this could happen.

    Demolishion!!!!!! What happens then?

    Axwhale 🙁

  • #63216
    Profile photo of Anonymous
    Anonymous
    Participant

    @goodstich44 wrote:

    our lawyers (recommended by the estate agents)

    Now you know who your lawyer is really working for.

    The responsibility to obtain the bank/insurance policy was your lawyer’s. no one else’s and he’sprofessionally liable for that and can be heavily fined by the Law Bar. He has no excuse whatsoever. If you don’t have it now it’s only his fault. Keep all correspondence between him and you and have it all in writing, telephone conversations are useless. You want him to put things down on writing either by email or fax. Distrust lawyers who are never willing to put down on writing what they are telling you, they are actually avoiding legal prove that could be used against them in courts.

    PM Claire or Mark and find yourself another conveyancing lawyer immediately, your current lawyer is actually working for Aifos, I have no doubts.

    You may complete and the property will be under your name but it is useless like a broCken toy, you won’t be able to live in it, take a mortgage against it, obtain water, electricity, telephone, gas supply not even sell it on because no lawyer will allow it’s client to purchase it from you without said LFO etc… Your lawyer is über irresponsible. With no LFO granted its utterly irresponsible to complete, it’s almost as If the house werent yours.

    What’s all this garbage your lawyer keeps throwing at you about “Aifos says this…”, Aifos thinks that…” ” Oh no, Aifos will not agree to this…”

    FGS, he’s your lawyer not theirs. So far I can see clearly he’s taken care of their interests (REA and Aifos). Dump him immediately, that lawyer is useless.

    Don’t worry, your situation is not at all hopeless, you have all on your side to win albeit it’ll take time and you’ll need a good lawyer on your side. The laws are there, use them !

  • #63217
    Profile photo of Anonymous
    Anonymous
    Participant

    axwhale wrote:
    I am confused about the BG issue still, our solicitor said to us when I pointed out we hadn’t got a BG or even seen a copy of it that if we wanted one “it can be granted but the expenses have to be paid by the client so if we wished to have one we would have to pay for it”

    Quote:

    False, it’s free and the law expressly says that the developer shall have to pay for it. Even so in almost 100% of cases the developers put down in a contract a clause that states that the purchaser shall pay for it. This clause is abusive and illegal.

    You need those guarantees badly, even If you have to pay for them do so. later on your lawyer can always sue them and ask for the money back. Any judge will condemn them to pay you the costs of those guarantees. Don’t let your lawyer fool you he’s trying to deprive you from a right you are entitled to in a law that’s almost 40 years old, it’s ludicrous.

    axwhale wrote:
    Junta of Andalucia apparantly our solicitor told us that the builders had licences when they started work and doing the buildings but after that it changes, the classification of the land changed into non urbanizable and that means cannot be built on. It would have to be changed back to make things legal.

    IS THIS RIGHT ? CAN THEY JUST CHANGE THE CLASSIFICATION OF THE LAND? Or is it the case of the builder/ developer telling lies in the beginning.

    Quote:

    Utterly untrue and false. It cannot do so and has never done so, this has never happened, there isn’t even a single case. Its only blatant. We live under the Empire of Law.

    Your lawyer is working for the developer I can guarantee it. Same advice as usual, dump him and find yourself an independant lawyer immeadiately.

    Foreigners should really get there act together and start reporting these vulture lawfirms en masse to Malaga’s Bar Council and to the British Council or Embassy.

    If you don’t report these cases the relevant Authorities are not aware of them. Expose these people to the british media. These lawyers , developers, REAs are not professionals and are hurting the whole tourist industry in a very bad way. Don’t let them get away with it. The laws are there but those biassed lawyers are not using them in your disfavour.

  • #63218
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    Anonymous
    Participant

    Hi Drakan,

    You must get increasingly frustrated by these types of cases. I do just reading about them. What I don’t understand is why people STILL continue with this type of lawyer when all they have to do is say “bye-bye”!! 🙄 As soon as we realised which side our original lawyer was batting for (which was immediately) we were out of the door. OK so the next one was ineffectual, but we got the right one in the end!

    We actually had to get on a plane to Spain asap and do the footwork for ourselves as did Sofia & Charlie and some others in our group. I know of two who literally left their workplace and jumped on a plane!! No appointments even made. They just pitched up on their lawyers doorstep!

    No one can expect to move things along sitting behind a computer screen. Some things take time and effort. Changing lawyers is one of them. IMHO
    Best wishes,

    Claire.

  • #63219
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    Anonymous
    Participant

    Hi Claire.

    It just amazes me how they get away with it. ME are making millions of euros per year and they act in a totally negligent manner towards their clients. The same can be said about other “leading” lawfirms, REAs and developers. They really have to be exposed for what it’s worth.

    Aifos is the pinnacle of this cynism. They need british clients, no british, no businesss. If british got together forming associations this would not happen. They prey on individuals and disregard arrogantly any complaints. they couldn’t possibly ignore large pressure groups.

    Sorry for the rant. I need my morning cofee 😥 . Back to work.

  • #63220
    Profile photo of Melosine
    Melosine
    Participant

    Problem is many of the *British* don’t like to admit they have been conned and even when they do seek advice and the truth and remedial actions spelled out still many are loathe to admit it won’t eventually be okay. So forums are used to air their grievences .However it is ACTION that is needed as we have just witnessed.

    A**** ( formally known as ) Sophia have been dealing improperly for some years. The numerous letters I have read about their behaviour on many forums …even in the press and still they are conning people. They are infinately worse than the time share
    An action group from clients who have been subjected to this mismanagement of their hard earned funds is the only way to stop this and other such companies…although as before they will just register under another name and start again……

    Those in England who have been mislead by this company or similar should seek advice at their local citizens advice centre. Okay the CAB probably won’t be able to individually assist BUT what they will do is HIGHLIGHT what is happening through the property exhibitions in UK and THEY WILL campaign to the Government to get this abuse stopped.

  • #63222
    Profile photo of Anonymous
    Anonymous
    Participant

    A***s is planning to go public in 3-4 years time and raise hundreds of million of euros. As other cases we’ve recently witnessed in the spanish stock market, spanish developers are going public to raise BIG money and avoid the looming crash (which already started in 2004-2005).

    A***s is unbelievable in the way they act. The keep marketing and selling off-plans in the UK and Germany in plots of land which aren’t rightfully theirs, they haven’t even bothered to apply for permissions to build at the Town Halls and in most cases the plots of land are rustic so you cannot even build !!! After four years without a bank guarantee they offer to swap your off-plan in a development which is very inferior to the one you bought in or else you lose a lot of money and time. They knew this from the beginning and know all-too-well that very few clients will sue them so the ball keeps rolling on and on.

    They are playing with the purchasers money, speculating with it. This company started off in 1997 and already have a huge turnover of 300-400million euros per year.

  • #63236
    Profile photo of Anonymous
    Anonymous
    Participant

    @Drakan wrote:

    A***s is planning to go public in 3-4 years time and raise hundreds of million of euros. As other cases we’ve recently witnessed in the spanish stock market, spanish developers are going public to raise BIG money and avoid the looming crash (which already started in 2004-2005).

    A***s is unbelievable in the way they act. The keep marketing and selling off-plans in the UK and Germany in plots of land which aren’t rightfully theirs, they haven’t even bothered to apply for permissions to build at the Town Halls and in most cases the plots of land are rustic so you cannot even build !!! After four years without a bank guarantee they offer to swap your off-plan in a development which is very inferior to the one you bought in or else you lose a lot of money and time. They knew this from the beginning and know all-too-well that very few clients will sue them so the ball keeps rolling on and on.

    They are playing with the purchasers money, speculating with it. This company started off in 1997 and already have a huge turnover of 300-400million euros per year.

    That makes me sick, what can I say. Are they above the law? Filling govt ministers pockets or something to keep quiet? Who can stop them if spanish law won’t end their businesses? I hope they choke on every tapa they eat at the expense of the suffering buyers.

  • #63246
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    Anonymous
    Participant

    Thankyou so much Draken for your reply.

    I shall now be able to do something armed with information . Thank you again for your time . I appreciate it.

    Axwhale

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