The 13th Court of First Instance of Seville has declared the nullity of a multi-currency mortgage (multi-currency loan with mortgage guarantee) of a home, determining that the debt is the outstanding balance of the loan referenced in euros and that it must be referenced not in yen but in euros. The financial institution CaixaBank was also ordered to pay the costs of the proceedings.

The loan was taken out in 2007 for a term of 30 years.

According to Bufete Salmerón, the law firm that obtained the pioneering ruling, the client will be able to recover around €40,000 from the date of signing the loan until the date of the ruling, and if we maintain the exchange rate scenario between the yen and the euro until the end of the loan, they will save another €80,000 approximately.

This ruling includes the grounds set out in the lawsuit filed in April 2016, as well as the new ruling of the Supreme Court Civil Division of 15 November.

Fernando Salmerón, Director of the Sevillian law firm, states that the problem lies mainly in the fact that taking out a multi-currency mortgage is only advisable if the person taking it out has a very high level of financial knowledge, because at the end of the day it involves playing with currency exchange rates.

We must not forget that the ordinary citizen, the one who is going to buy a house with his savings, is not usually an expert in international financial markets. Their objective, when taking out a multi-currency mortgage, is none other than to buy a home while paying a lower interest rate for it and not to manage or speculate on the currency exchange rate. It is for this reason that you should be informed about the risks that you assume when taking out a multi-currency mortgage.

Thus, in a commercial relationship where there are conflicting interests – the borrower who wants to pay less and the lender who wants to earn more – the game starts unfairly.

Bufete Salmerón, a law firm specialising in Banking and Commercial Law, among other matters, advises those who find themselves in the same situation to complain and to review this type of financial product with a specialist before proceeding to sign this type of loan.