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10-year interest-only mortgages to come to an end this year for properties purchased in the peak of 2007 in Spain.
Spain’s collapsing prices over the years have left homeowners with numerous arrears.
With the breakdown of Spain’s property market in 2007, it has been evident that Spain’s national average house prices rose by thousands of euros.
Many people fell victim to this trap, getting lured by interest-free mortgages and rental guarantees.
With a fixed 10-year term and affordable repayments, many believed this was too good to be true…turns out it was. For instance, Halifax were the main protagonists of these mortgages along with a mixture of slack lending to large volumes of UK and Irish nationals to buy abroad.
The thought of retiring in the sunshine is a dream for most, so much that hundreds of individuals took equity out of their own houses to purchase their dream home in the sun.
House Price changes in Spain over the years
Over a decade later…What happens now?
Many families who have taken out a foreign interest-only mortgage will soon be reminded that the 10-year interest only period has now come to an end where full repayment is due.
An example of a recent case we had was where a couple came to us with an outstanding mortgage balance of €179,000, the couple managed to keep within their affordable monthly payments of €132.00 however as their mortgage was interest-only this meant monthly repayments would increase in excess of €1,200 not to mention their property was in severe negative equity.
In the aforementioned scenario, EU Property Solutions were able to liaise with the lender on behalf of the clients and conclude matters in their entirety by disposing of the property and settling the mortgage shortfall for 4% of the original debt. To see more successes’ like this, click here: https://www.eupropertysolutions.com/testimonials
If this is something you are experiencing, you are NOT alone.
This is an issue that we see becoming more predominant as the 10-year life span comes to an end for properties purchased in the peak of the market in 2007.
We URGE you to get in contact.
In our experience, we can advise that Banks and lenders recognize that this is a ticking time bomb and so are welcoming a proactive response through recognized and reputable intermediaries.
If you require any advice in respect of a problematic property in Spain or further afield, please contact the team today at EU Property Solutions who can provide options and assistance.
0330 124 1230