In our last article we looked at the background of so-called ‘vulture funds’, and their business model. Now we explain what it means for you if a vulture fund buys your Spanish mortgage loan, and what are your options if this happens.
Can my lender sell my Spanish mortgage loan to a vulture fund?
Yes, lenders can sell the loans they own to anyone they like, and they do not need your permission to do so. This right to sell your loan on is usually buried in the small print of your mortgage agreement.
The first you may know of it will probably be a letter from the new owner of your loan, or a debt collector acting for them. The vulture fund will write to inform you that they have bought the loan from your previous lender. This could happen years after your last contact with the previous lender, if you have fallen behind on your Spanish mortgage repayments and tried to walk away from the loan.
What happens next?
Time is money, so vulture funds move fast, in contrast to the slow-moving pace of many traditional lenders in Spain. Before long you can expect the following steps to be taken by the new owner of your Spanish mortgage loan:
Although it may have been several years since you last spoke with your previous lender, Vulture Funds can act quickly and in the immediate term you can expect:
- More aggressive measures to pursue you for you loan repayments, including numerous letters, calls, emails and texts putting you under pressure to react.
- Threatening your UK assets, especially 2nd charges on UK homes – lenders can work across jurisdictions, which puts your UK assets e.g. your home at risk.
- The costs of your debt to start rising fast as the vulture fund adds additional costs like legal fees and compound interest to your outstanding loan.
Can vulture funds Chase me in the UK for mortgage loan in Spain?
The simple answer: Yes.
Legal notification will be sent to your 2nd address in Europe. The vulture fund may contact you in the UK, but this is not guaranteed. As a result of this, many overseas borrowers are unaware of proceedings against them until the process is gathering pace. In terms of debt pursuit in the UK or Ireland, lenders will look to recover your home assets.
On top of this, many lenders will appoint UK Debt Collection agents to act for them, which could have a negative impact on your credit report.
Can I just ignore the vulture fund and its debt collectors?
Ignoring the new owner of your debt will make it harder to reach a negotiated settlement that might be in your interests, and will only allow the case to get more expensive and further out of your control. Putting your head in the sand will probably end up with the vulture fund pursuing you back home for an even bigger debt.
What can I do?
You have two options at this stage:
- Ignore the issue and hope that it disappears: You will face rising costs, additional interest, an increasingly aggressive vulture fund, your assets in the UK will be at risk and your chances of ever finding a resolution are low.
- Speak to an expert, reach a settlement, and leave it all behind you.
Get in touch
If you are struggling to pay a mortgage loan in Spain, or have been contacted by a vulture fund who now owns your loan, get in touch to discuss your situation and how best to resolve it. We have helped hundreds of people in the same boat as you, we know how the vulture funds work and, most importantly, we know how to help you. Lets us help you sort this problem out and put it behind you, leaving you free of all foreign financial burdens.
Call us today on +44 (0)330 124 1230 or email us at firstname.lastname@example.org. We can provide solutions for any foreign property issues and financial distress. That’s what we do.