Mortgage irregularity

[GarySFBCN]

Hello,

In August 2012, I got a mortgage from a Spanish bank.  The amount of the mortgage was for 197,000 euro, the term 20 years and the floor rate was (and still is) 4.25%.

When I use those numbers in my mortgage calculator, it shows that my monthly payment should be 1219.89.   As the bank has been taking 1219.90 out of my account every month (my account and mortgage are with the same bank), I assumed that everything was fine.

Recently, I reviewed my mortgage schedule on-line.  I was surprised to see that while 1219.90 has been withdrawn every month, only 1217.85 has been applied to the mortgage each month.

To me, this appears to be a change in terms of the mortgage, and hopefully, illegal.

Do any of SPI readers have any ideas about this?  Is this a typical practice in Spanish banks ?

Thanks,  Gary

 

 

 

 

[Mark Stücklin]

Wow Gary, that’s a very technical mortgage question 😯  Sometimes I get the impression these guys do what they please, and then justify it with some incomprehensible clause in the small print. However, the place to start is querying it with your lender. Have you asked them yet?

[GarySFBCN]

I’m going to meet with them next week or the week after.  About twice each year, there are odd fees that show up.  I go to their office and complain and the fees are removed.

But this seems to be a new, hidden fee, and if true, it changes the term of a contract and that’s illegal.

I’ll post the outcome here on this thread.

Thanks.

[GarySFBCN]

Update:  I visited the bank.  They confirmed that the amount being withdrawn from my bank account is the amount being applied to the mortgage.  They also told me that they’ve lowered some fees (but couldn’t identify which fees), and that is why my monthly bill is lower.  But using any mortgage calculator in the world shows that I should not be paying the reduced amount.   Fees have nothing to do with the amount I should be paying.   Anyway, I’m not going to worry about this right now.

Gary

[marios]

Gary, I know some people on our urbanisation are challenging the fact that banks have put a floor on interest rates in fact I’m sure some people have won there cases and have got back many thousands of £s I would look into this if  was you and I will ask around myself.

[marios]

Maybe its not that simple

 

http://www.advoc.com/view-news/Spain’3A+Removing+the+Floor+Clause+From+Our+Mortgages+-+Criteria+and+How+To+Go+About+It/

[GarySFBCN]

Thank you Marios. I did review that but I don’t qualify.

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