- July 22, 2007 at 12:07 pm #53047
Regarding those who have bought off-plan ‘illegal’ properties with no Bank Guarantee – is it possible that the Bank would have refused to provide a BG at the outset ❓ The REAs & their ‘recommended’ lawyers concerned, knowing this from the beginning. Sounds a naive question, I know, but nevertheless…..wondering what the Bank’s position has previously been on this. Would they grant a BG on the assumption of Licences eventually being in place ❓
I’m wondering how information can be obtained on Banks refusing to give BGs to Developers (knowing the land was ‘greenbelt’ etc). Presumably they’d refuse their application for a mortgage also 💡
- July 22, 2007 at 1:30 pm #73723
During the course of a conversation with the builder of our house and a couple of REA friends ,all from Almeria region, it emerged that banks are now refusing to issue BG’s unless builder/developer has the required personal assets of over 3.100,000,000 euros .
So maybe this was always the reason many folk weren’t offered BG’s previously .Banks weren’t interested in whether a licence was in place or not . Would only issue BG’s if covered by personal fortune of developer.
- October 25, 2007 at 9:00 am #75825
How do you use a bank guarantee if your contract is up and your property not built.
- October 25, 2007 at 9:12 am #75827
Suzanne, in our case the bank would not give BG’s (or stopped giving them 😕 )for Santa Maria Green Hills because they knew there was a problem. This was confirmed by another lawyer we later dealt with. We were told by DLM, our original firm of lawyers who had POA to sign the purchase contract, that we would have a BG for our first stage payment. This did not happen, unbeknown to us. We only got a BG 15 months later when they (Eralia) eventually owned up to the fact that our apartments would not be built. Our BG was dated 2 days before we were told of this by DLM. As we later learned, the directors of Eralia had to pay a vast sum of money to the bank to cover the BG’s. Only then were BG’s issued. This seems to be in line with what Melosine said.
- October 25, 2007 at 10:16 am #75835
Had experience at Corvera Golf where they don’t yet have licences for later phases, but will tell you that there are bank guarantees.
But, as I recall, the guarantee will only kick in after licences are granted and a certain time after construction is due to start – 3 years I think.
So, the purchase contract didn’t state a date to begin construction – because they had no licence, so they didn’t know when they could begin.
So, if they never get the licence you are screwed because the guarantee is useless.
And even if they get the licence, and then the developer goes bust, you also have problems because there is no start date for construction. So when is 3 years after a start date, when there is no start date ? It was just open ended.
Get a good lawyer and have guarantees checked very carefully.
- October 25, 2007 at 10:33 am #75838
am I reading this correctly, are you saying that if our guarantee was issued when no licence was in place it is void.
- October 25, 2007 at 10:41 am #75839
I think the example was for Corvera Golf. As far as I know, if you have a valid Bank Guarantee for the monies you’ve paid, the licence situation is irrelevant. Maybe one of the forum lawyers can confirm?
One of the things to watch with Bank Guarantees is their validity date. Once that has passed it is useless. A good lawyer will always request a new one to follow on, so there is no period when your money is unprotected.
- October 25, 2007 at 12:51 pm #75844
Firstly there were bank guarantees on phase 1 Green Hills my solicitor ensured her clients had one. 😉
Second and not defending anyone as no defence is acceptable only to point out that if Eralia paid up then its far better than those developers that refuses no matter what court case goes against them. 😉
- October 25, 2007 at 6:09 pm #75853
Was that in Sept/ October 2003 Frank? Eralia didn’t “pay up”…to the people whose money they took…but let’s not go over old ground. I’ve told it as it was.
- October 25, 2007 at 7:06 pm #75855
: Yep 2003 and this is nearly 2008 .
As you say ? lets not go over old ground shall we 😉
- October 25, 2007 at 7:42 pm #75857
It may be old ground for some but unfortunately not for those who still haven’t had their money returned for a 2003 no-build.
Yes, it’s nearly 2008 which makes the situation even more disgusting.
- October 25, 2007 at 8:36 pm #75860
Hi Charlie 😉
Yep I agree and the sad fact is that like many similar developments the developers may very well go bankrupt and then they will have no chance of anything. 😥
As we say,it goes to show how important it is to have a good independent lawyer.(as in any country)
Goes to show the need to keep people informed of just how bad it can get by buying off plan.
Just watched a programme on Cyprus and the same corruption seems to be going on there 😥
Then watched another programme on a well known investment property company in the U.K whose clients has lost a small fortune 😥
Seems there is no safe haven anywhere.
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