Real estate financing

The Supreme Court (TS) has ruled on a case of two consumers who signed in 2007 two mortgage loans with a financial institution. In both cases, the variable interest was calculated using the IRPH Cajas as the main index (and as a substitute index, the IRPH Entidades). In addition, the contracts included a late payment interest of 18%.

The clients sued the institution requesting, mainly, the nullity of the IRPH clauses (firstly for "defect in consent" and, subsidiarily, for "abuse" linked to the lack of transparency). In short, they argued that they had not contracted with sufficient information and that, therefore, that reference to the IRPH should be eliminated. They also requested the refund of amounts and, as an alternative, that the IRPH be replaced by the Euribor (without a spread, as they indicated).

In the first instance, the court did annul the clause annulled the clause IRPH clause IRPH clause Upon reaching the Supreme Court, the plaintiffs insisted that, according to the

European case law they referred to, if a clause like the IRPH is not transparent that should lead to considering it abusive abusive lack of transparency may be a requirement requirement is not sufficient on its own is not sufficient on its own significant imbalance significant imbalance contrary to good faith. Finally, the Supreme Court dismisses the appeal, upholds the validity of the IRPH clause.

If you are thinking of carrying out any operation or business that involves formalizing a real estate credit contract, our professionals can advise you on defending your interests