Spanish Property Insight › Forums › Spanish Property Forums › Real Estate Topics, News & Discussion › Farewell message from ‘Charlie’ and ‘Sofia’ › Reply To: Farewell message from ‘Charlie’ and ‘Sofia’
Thank you all for your kind words, I appreciate it.
@Just Frank wrote:
Think someone needs to clarify who owns what and what happens if you havent completed on a property and the developer goes bankrupt
“The bank funding the developer owns it and can take it from you if the the developer fails to meet their ‘mortgage’ payments, goes bankrupt etc.
With all these arrests/court cases/bankrupcies going on, do you really want to take the chance?”
Now what happens to the deposit paid ?
Unless you have a Bank Guarantee or Insurance Policy securing your stage payments and deposits you lose all your money Frank. No one will come to bail you out.
That is why I have insited so many times over these years for everyone to make sure they have a BG that is valid (which hasn’t expired as they only secure for a given deadline), that covers all the stage payments (you can have many BGs each securing parts of your stage payments) under your name and surname, with your passport number, indicating the property that is being purchased etc….It goes to say that obviously you are the beneficiary of the BG, not a REA. I write this because I’ve had many queries on BGs under the name of the REA that sells a development and not under the name of the client.
If the developer defaults, and we are already starting to see high-profile developers going under such as Llanera, the bank obviously seizes the development.
Just to clarify, the property is never yours until completion, it belongs to the bank really.
Spain is a beautiful country to live in with a very high quality of life at a reasonable value. Just be sure to do your homework before purchasing here or anywhere.