Mortgage and Sale Options

[Madgolfer80]

Hi all,

I have an apartment in Costa del Sol – bought 2006 and am in negative equity of €50k by my estimates. As with many people I am currently struggling to pay the mortgage and I’m looking at the options.

From looking at forums there are a number of options available to work with the banks e.g. Dacion en Pago but they all seem to depend on being in positive equity.

If I sell the property it will at least reduce what is left on my mortgage to the negative equity plus the cost of sale. This while very dissappointing at least reduces my monthly outgoings.

My questions are :
– can you sell a property in Spain without fully clearing the mortgage
– what are the likely cost of sales items e.g. sales fees, IVA, legal etc

I’ve heard that some people are handing back the keys and the bank is forced to sell it. I’ve seen the posts about the banks being able to chase people in court in other countries for the gap and substantial costs. I’m based in Ireland and it is in a similar bad position to Spain – I think we are ahead of them and guess Spain has another 2 years of falling prices. In Ireland the number o reposessions is relatively low compared to the amount of people in trouble who cant pay their mortgage and it is a last resort.

What are the realistic chances of a Spanish bank chasing me in an Irish court for €50k – has anybody any statistics for Ireland, UK or other EU countries – and what the reality is ?

Thanks

[katy]

There is no evidence that spanish banks have gone through the courts in other countries. Lots of hearsay and scaremongoring that’s all.

You wouldn’t be able to sell without clearing the mortgage

[Madgolfer80]

Thanks Katy

Looks like my main options are to negotiate a reduce payment option such as interest only ot hand back the keys

Will do some more research first

[Anonymous]

Make sure the interest only option is something like 5 years with an extension of 5 years to the term in addition. Read the thread about someone just getting a 2 year interest only deal.

Maybe in 5 years the market will be in a position that it’s actually possible to sell.

[Author]

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