Bank Guarantees on Off-Plan Property Purchases.
Dec 15th 2008, 3:01 pm
#1
BE Enthusiast
Thread Starter
Joined: Apr 2007
Posts: 985
Bank Guarantees on Off-Plan Property Purchases.
Has your bank guarantee failed you? Guarantee dishonoured: result - lost savings and no property! Can’t get your deposit back? Spectre of being chased by the developer to complete?
Action is needed against banks when their guarantees are not honoured. The following is a petition to the Governor of the Bank of Spain regarding the occasional failures in bank guarantees over unfinished or debt-ridden properties. Bank of Spain Petition
‘Dear Governor, The petitioners below are all would-be purchasers of property in Spain. They have paid substantial deposits (between 33% and 50% of the purchase price) to developers to reserve each particular property. They have received the necessary bank guarantees through their lawyers. This simple, straightforward assurance required by law and vetted by lawyers for all sides has been accepted in good faith by would-be purchasers.
However, in all the cases below, contracts are not being fulfilled, and the banks are refusing to honour their given guarantees. In many cases court action has ensued. Even when cases have been won by the petitioner banks have then appealed and the initial verdict has been overturned.
In the light of your recent statement published in the national press [El Pais, August 2008];
‘[The Bank of Spain] is adamant that the financial institutions underwriting the guarantees must pay out in full if developers are in breach of contract’,
and that of Fernando Herrero, VP of the Adicae association of bank users that,
‘The law is clear. If the conditions of the guarantee are satisfied, execution is obligatory’,
it is clear that now there must be an indisputable direction coming from you that a guarantee is exactly that – a guarantee – and must be honoured. As it is, it is a travesty of justice and is bringing the proud nation of Spain into disrepute.
We, the undersigned, wish to protest at the arbitrary use of the law by the banks in order to retain our deposits and we ask that you take immediate action, according to the Banking Discipline Law, against those banks which are still refusing to honour the guarantees they gave.
We demand that our guarantees be honoured’.
Perhaps the petition could use your signature…?
Action is needed against banks when their guarantees are not honoured. The following is a petition to the Governor of the Bank of Spain regarding the occasional failures in bank guarantees over unfinished or debt-ridden properties. Bank of Spain Petition
‘Dear Governor, The petitioners below are all would-be purchasers of property in Spain. They have paid substantial deposits (between 33% and 50% of the purchase price) to developers to reserve each particular property. They have received the necessary bank guarantees through their lawyers. This simple, straightforward assurance required by law and vetted by lawyers for all sides has been accepted in good faith by would-be purchasers.
However, in all the cases below, contracts are not being fulfilled, and the banks are refusing to honour their given guarantees. In many cases court action has ensued. Even when cases have been won by the petitioner banks have then appealed and the initial verdict has been overturned.
In the light of your recent statement published in the national press [El Pais, August 2008];
‘[The Bank of Spain] is adamant that the financial institutions underwriting the guarantees must pay out in full if developers are in breach of contract’,
and that of Fernando Herrero, VP of the Adicae association of bank users that,
‘The law is clear. If the conditions of the guarantee are satisfied, execution is obligatory’,
it is clear that now there must be an indisputable direction coming from you that a guarantee is exactly that – a guarantee – and must be honoured. As it is, it is a travesty of justice and is bringing the proud nation of Spain into disrepute.
We, the undersigned, wish to protest at the arbitrary use of the law by the banks in order to retain our deposits and we ask that you take immediate action, according to the Banking Discipline Law, against those banks which are still refusing to honour the guarantees they gave.
We demand that our guarantees be honoured’.
Perhaps the petition could use your signature…?
Dec 16th 2008, 9:55 am
#2
BE Enthusiast
Thread Starter
Joined: Apr 2007
Posts: 985
Re: Bank Guarantees on Property Purchase
Hmmm:
The guarantees are only concerned when purchasing off-plan properties. The title should really be: Bank Guarantees on Off-Plan Property Purchases.
The guarantees are only concerned when purchasing off-plan properties. The title should really be: Bank Guarantees on Off-Plan Property Purchases.
Dec 18th 2008, 4:19 pm
#4
Straw Man.
Joined: Aug 2006
Location: That, there, that's not my post count... nothing to see here, move along.
Posts: 46,302
Re: Bank Guarantees on Off-Plan Property Purchases.
OK
Dec 18th 2008, 4:41 pm
#5
BE Enthusiast
Joined: Mar 2006
Location: Leeds, West Yorkshire and Tavira
Posts: 537
Re: Bank Guarantees on Off-Plan Property Purchases.
Has your bank guarantee failed you? Guarantee dishonoured: result - lost savings and no property! Can’t get your deposit back? Spectre of being chased by the developer to complete?
Action is needed against banks when their guarantees are not honoured. The following is a petition to the Governor of the Bank of Spain regarding the occasional failures in bank guarantees over unfinished or debt-ridden properties. Bank of Spain Petition
‘Dear Governor, The petitioners below are all would-be purchasers of property in Spain. They have paid substantial deposits (between 33% and 50% of the purchase price) to developers to reserve each particular property. They have received the necessary bank guarantees through their lawyers. This simple, straightforward assurance required by law and vetted by lawyers for all sides has been accepted in good faith by would-be purchasers.
However, in all the cases below, contracts are not being fulfilled, and the banks are refusing to honour their given guarantees. In many cases court action has ensued. Even when cases have been won by the petitioner banks have then appealed and the initial verdict has been overturned.
In the light of your recent statement published in the national press [El Pais, August 2008];
‘[The Bank of Spain] is adamant that the financial institutions underwriting the guarantees must pay out in full if developers are in breach of contract’,
and that of Fernando Herrero, VP of the Adicae association of bank users that,
‘The law is clear. If the conditions of the guarantee are satisfied, execution is obligatory’,
it is clear that now there must be an indisputable direction coming from you that a guarantee is exactly that – a guarantee – and must be honoured. As it is, it is a travesty of justice and is bringing the proud nation of Spain into disrepute.
We, the undersigned, wish to protest at the arbitrary use of the law by the banks in order to retain our deposits and we ask that you take immediate action, according to the Banking Discipline Law, against those banks which are still refusing to honour the guarantees they gave.
We demand that our guarantees be honoured’.
Perhaps the petition could use your signature…?
Action is needed against banks when their guarantees are not honoured. The following is a petition to the Governor of the Bank of Spain regarding the occasional failures in bank guarantees over unfinished or debt-ridden properties. Bank of Spain Petition
‘Dear Governor, The petitioners below are all would-be purchasers of property in Spain. They have paid substantial deposits (between 33% and 50% of the purchase price) to developers to reserve each particular property. They have received the necessary bank guarantees through their lawyers. This simple, straightforward assurance required by law and vetted by lawyers for all sides has been accepted in good faith by would-be purchasers.
However, in all the cases below, contracts are not being fulfilled, and the banks are refusing to honour their given guarantees. In many cases court action has ensued. Even when cases have been won by the petitioner banks have then appealed and the initial verdict has been overturned.
In the light of your recent statement published in the national press [El Pais, August 2008];
‘[The Bank of Spain] is adamant that the financial institutions underwriting the guarantees must pay out in full if developers are in breach of contract’,
and that of Fernando Herrero, VP of the Adicae association of bank users that,
‘The law is clear. If the conditions of the guarantee are satisfied, execution is obligatory’,
it is clear that now there must be an indisputable direction coming from you that a guarantee is exactly that – a guarantee – and must be honoured. As it is, it is a travesty of justice and is bringing the proud nation of Spain into disrepute.
We, the undersigned, wish to protest at the arbitrary use of the law by the banks in order to retain our deposits and we ask that you take immediate action, according to the Banking Discipline Law, against those banks which are still refusing to honour the guarantees they gave.
We demand that our guarantees be honoured’.
Perhaps the petition could use your signature…?
Dec 19th 2008, 11:36 am
#6
Just Joined
Joined: Dec 2008
Posts: 2
Re: Bank Guarantees on Off-Plan Property Purchases.
There are various problems associated with Bank Guarantees (BGs).
Despite being a legal requirement when buying off-plan, in some cases BGs were never issued at all. If you find yourself in this position then you need to seek legal redress as the fault lies either with the developer (who should have arranged for the BG to be provided to you) or with your own lawyer (who approved your signing the contract with the developer without the BG in place) or both (they may have been acting in collusion). This means that you would have to find a new lawyer - a litigation lawyer, not just a conveyancer - to begin a court action.
In other cases, your lawyer may tell you that you have a BG, but you haven't seen it. Unless s/he provides you with a copy along with the contract then you'd better believe you don't have one.
Some would-be purchasers were given a BG but they were incorrectly worded and/or contained abusive clauses.
People who have been really duped are those who have been given BGs by 'false' banks/insurance companies or those not recognised in Spain.
Others, like me, were given a BG from a High Street Spanish Bank with all the right words in all the right places and the bank still would not honour it. Three and a half years of litigation involving three court cases and a review later, my BG remains dishonoured. I have exhausted this particular legal process - and my finances!
A BG is meant to be the purchaser's safeguard if things go wrong. It's the only safeguard in the whole sorry business. But the truth is it's no safeguard at all.
The Governor of the Bank of Spain has begun to make disapproving noises about the actions of the banks and claims on their website that by invoking the Banking Discipline Law he may be able to do something about it. This is why I have instigated the petition to him. But he can only take action aginst banks who have issued guarantees. If there is no guarantee then that is the fault of the developer. They are the people who have to provide one by law - and your lawyer should have insisted that you have a correctly worded one in the very first instance.
A helpful website which is very clear about bank guarantees can be found here:
http://www.marbella-lawyers.com/arti...ank-guarantees
I should add I have no dealings whatsoever with these lawyers. My own lawyer, a very competent man, is someone completely different.
The petition to the Governor of the BoS is very narrowly focussed as I am appealing to him to look into the abuses in which the banks are involved in not honouring BGs that they have issued and that have been accepted in good faith by would-be purchasers. So, if you are in this position - you have been given a guarantee by a bank, however loose it is, then please add your signature to the petition. You are given boxes in which you name the bank and the developer, but these are hidden from public view, and there is a space for your comments which you can allow to be viewed, or not as you wish.
http://www.gopetition.com/petitions/spanishbankguarantees/signatures.html
Thank you for your support
ffletch
Despite being a legal requirement when buying off-plan, in some cases BGs were never issued at all. If you find yourself in this position then you need to seek legal redress as the fault lies either with the developer (who should have arranged for the BG to be provided to you) or with your own lawyer (who approved your signing the contract with the developer without the BG in place) or both (they may have been acting in collusion). This means that you would have to find a new lawyer - a litigation lawyer, not just a conveyancer - to begin a court action.
In other cases, your lawyer may tell you that you have a BG, but you haven't seen it. Unless s/he provides you with a copy along with the contract then you'd better believe you don't have one.
Some would-be purchasers were given a BG but they were incorrectly worded and/or contained abusive clauses.
People who have been really duped are those who have been given BGs by 'false' banks/insurance companies or those not recognised in Spain.
Others, like me, were given a BG from a High Street Spanish Bank with all the right words in all the right places and the bank still would not honour it. Three and a half years of litigation involving three court cases and a review later, my BG remains dishonoured. I have exhausted this particular legal process - and my finances!
A BG is meant to be the purchaser's safeguard if things go wrong. It's the only safeguard in the whole sorry business. But the truth is it's no safeguard at all.
The Governor of the Bank of Spain has begun to make disapproving noises about the actions of the banks and claims on their website that by invoking the Banking Discipline Law he may be able to do something about it. This is why I have instigated the petition to him. But he can only take action aginst banks who have issued guarantees. If there is no guarantee then that is the fault of the developer. They are the people who have to provide one by law - and your lawyer should have insisted that you have a correctly worded one in the very first instance.
A helpful website which is very clear about bank guarantees can be found here:
http://www.marbella-lawyers.com/arti...ank-guarantees
I should add I have no dealings whatsoever with these lawyers. My own lawyer, a very competent man, is someone completely different.
The petition to the Governor of the BoS is very narrowly focussed as I am appealing to him to look into the abuses in which the banks are involved in not honouring BGs that they have issued and that have been accepted in good faith by would-be purchasers. So, if you are in this position - you have been given a guarantee by a bank, however loose it is, then please add your signature to the petition. You are given boxes in which you name the bank and the developer, but these are hidden from public view, and there is a space for your comments which you can allow to be viewed, or not as you wish.
http://www.gopetition.com/petitions/spanishbankguarantees/signatures.html
Thank you for your support
ffletch
