Multi-Currency Mortgage Claims
A Multi-Currency Mortgage is a product designed for a specific client profile that is well-versed in finance and the stock market.
At Carlos Haering Lawyers, we can confirm if your mortgage includes abusive clauses. We will study your case, determine its viability, and assist you in recouping all the money you overpaid.
What is a Multi-Currency Mortgage?
Multi-Currency Mortgages are complex financial products that were offered by banks mainly between 2005 and 2008.
At the time, given the general panic caused by high Euribor rates, banks decided to “launch” a new product that might “mitigate” or “prevent the consequences of” future spikes of the Euribor by linking it to other foreign currencies such as the Japanese yen and the Swiss franc. The inner workings of this new instrument were completely unknown to the average consumer and ultimately caused financial harm; namely, through an increase of the loan principal.
The argument for offering Multi-Currency Mortgages was that it would be ultimately beneficial for clients, as instead of being tied to the Euribor, which was reaching its historical peak, it was linked to “more stable” currencies, and this would result in considerable savings in mortgage payments.
However, in reality, a few months after signing a Multi-Currency Mortgage, the Euribor took a sharp dip and clients soon discovered that they were not only NOT taking advantage of any of the benefits advertised (as their mortgage was linked to other currencies) but they also would have saved a lot more by taking on a Euribor-linked mortgage.
Did your bank inform you about the potential risks?
Again, this financial product was designed for a specific type of client who is highly proficient in finances and the stock market. It also requires a detailed explanation of its workings and inherent risks, which in the majority of cases never occurred.
As a consequence, the affected consumers are all of those who were not sufficiently qualified to comprehend and were not properly informed about the risks of taking on this type of mortgage.
What can you do if you signed for a multi-currency mortgage?
We recommend you consult with a lawyer specialised in bank claims so you can file the corresponding claim and/or lawsuit, if applicable.
The first option is to file with your bank a draft agreement to reconvert your mortgage to Euros and tie the loan to the Euribor rate, including a claim for all amounts overpaid during the lifetime of your loan.
If the bank agrees to the proposal, it is crucial to not sign any documents presented to you. You must take those documents to a lawyer to determine if the bank’s offer is lawful and fulfils your claim in its entirety.
In case the bank proposal is not entirely in your favour or is just not feasible, the remaining step after the initial claim is exhausted is to file a lawsuit and have the Court force the bank to act in accordance to the law, through a judiciary sentence.
Claim your rights and resolve your multi-currency mortgage
At Carlos Haering Lawyers we provide a free consultation service and feasibility study to evaluate the merits of your particular case. Should you choose to, we are ideally suited to handle all the aspects of your legal claim, including taking it to the courts.
We are specialists in Banking Law and claims against financial institutions. Hundreds of favourable rulings for our clients attest to our ability. Call us now for a no-obligation consultation. We will respond with complete honesty and transparency. We do not require a single Euro in advance. We only charge lawyer fees if you recoup your money.
We will conduct a free, no-obligation, study of your case; estimate the possible monetary claim in your favour, and discuss with you the viability of your legal claim.
Courts uphold your claim and lawsuit on this matter
The Spanish Supreme Court (TS or Tribunal Supremo) is on your side. Its sentence of November 15, 2017, ruled that the clauses under scrutiny for this type of mortgage do not comply with the level of transparency required of banks and, as a consequence, declared the nullification of the loan and the removal of all references to foreign currencies. This means that these mortgages are to be converted into mortgage loans expressed in Euros and amortized in Euros.
The key in this ruling, as in other abusive clauses such as the Floor Clause (“Cláusula Suelo”) is the lack of transparency on the part of the bank at the moment of “selling” this financial product.
“[…] as multi-currency clauses have created a grave imbalance against borrowers, contradicting all requirements of good faith and as, ignoring the grave risks inherent to subscribing the loan, [borrowers] were incapable of comparing the offer of a multi-currency mortgage loan against other types of loans, [they have] as a consequence, seen their financial and legal situation worsened.”
The Supreme Court considers that, “despite the fact that the average consumer might have expected a certain level of increase in their mortgage payments due to monetary inflation, there are other inherent risks in this type of mortgage that they were not aware of.”