Mortgage loan contracts usually include a clause obliging the consumer to pay the Stamp Duty (Impuesto de Actos Jurídicos Documentados) on the mortgage. This is a tax levied on notarial, commercial and administrative documents and which, in reality, must be paid by the bank.
This clause has been declared null and void by the Supreme Court due to its abusive nature and, together with the mortgage incorporation and formalisation costs, it can be claimed back from the bank.
The Supreme Court considers that the stamp duty on the mortgage must be borne by the bank or the financial institution because it is the main interested party as it is the beneficiary of the registration of the mortgage guarantee.
In the contract, this clause is usually worded as follows:
“All taxes, commissions and expenses arising from the preparation, formalisation, correction, processing of deeds, modification – including division, segregation or any change that entails alteration of the guarantee – and execution of this contract, and for the payments and reimbursements derived from it, as well as for the constitution, conservation and cancellation of its guarantee, are for the exclusive account of the borrowing party, who is also responsible for the premiums and other expenses corresponding to the damage insurance, which the borrowing party undertakes to have in force under the conditions expressed ………
The borrower authorises the bank to cover the expenses necessary to ensure the correct registration of the mortgage hereby constituted and of the deeds prior to this deed, as well as the expenses derived from the cancellation of charges and annotations preferential to the said mortgage. The costs incurred may be charged to the borrower in the manner and under the conditions indicated at the end of this clause……”.
The ruling declaring this clause to be abusive concludes that:
“…this Chamber established that the passing on to the buyer/consumer of the mortgage incorporation costs was an abusive clause and, therefore, null and void.”
Furthermore, it declares these clauses null and void due to their generic nature, as they do not specify what expenses, commissions and taxes are involved.
This is especially important, because although practically all mortgages taken out up to now included this clause in a generic way, they might not do so in the future.
As for the rate and amount of this tax, it varies according to each autonomous government, but the truth is that it can be as low as 0.5% in the cheapest Autonomous Regions and up to, what is more common, 1.5% of the total mortgage loan. Thus, in an average mortgage of 120,000 euros, we are talking about an undue payment of 1,800 euros, an amount that could be reclaimed.
REVIEWING THE MORTGAGE LOAN CONTRACT
As we have already said, this Supreme Court ruling talks about abusive clauses referring, on the one hand, to the Stamp Duty (Impuesto de Actos Jurídicos Documentados) in the mortgage and, on the other hand, to its formalisation costs, both of which can be reclaimed from the bank.
If we also add other abusive clauses such as the already well-known floor clauses, loans referenced to the IRPH or the marketing of mortgage products in an inappropriate manner, as is the case of multi-currency mortgages or mortgage tranquillity, people who have signed a mortgage, in the last ten years, are paying much more than what they would actually be required to.
For this reason, the advice of Bufete Salmerón as a leading law firm in property and banking law is that consumers should review their mortgage loan contract and that they should do so with specialised lawyers who can detect the inclusion of abusive clauses and who, in a transparent manner, will provide their legal assessment.
Similarly, our advice extends to all those who want to take out a mortgage loan today. Before signing what will probably be the biggest loan you will ever take out in your life, it is advisable to review it with a lawyer you trust.