Alan73

Hi folks
First off thank you for all the feedback, comments and advice. All is greatly appreciated! I posted the original thread late last night so hopefully I can expand a bit now which might help make things clearer.
We bought a plot of land four years ago in the Costa del Sol - near Coin about 25 minutes inland from Marbella. Via the estate agent we purchased the plot through we met with three architects, looked at work they had previously completed etc and decided to choose one.
After a lengthy period of having the usual paperwork completed etc work began on the villa. It is a relatively big house over five levels and around 620m2 build with swimming pool and various terraces etc.
We noticed some problems shortly after moving in but this was put down to settlement etc and the issues appeared to be fixed by the builder.
However over time these problems re-appeared along with others elsewhere.
Late last year one of our terraces collapsed, followed shortly after by our swimming pool and various other patios and terraces. Cracks appeared in outside walls - a real nightmare!
Via our lawyer we brought in an independent technician/architect who advised us to move out immediately as the property was at risk of collapse.
The builder, architect and technician have also refused to accept any responsibility claiming this was caused by an Act of God - ie heavy rains. However no other property has been affected except ours.
With no accepting any blame we were forced to return to the UK, cordon off the villa completely on the instruction of the Town Hall and start legal proceedings.
The builder had insurance but it ran out a year ago. He claims the house was complete but we never signed any documents to say this was the case and the Town Hall has never been out to grant our habitation licence. We are suing him but dont expect to get a penny as he has nothing.
We were offered a 10 year building insurance midway through the build but after speaking to our lawyer who explained the pros and cons we decided not to proceed with it
The architect is registered through the architect college in Malaga and is all insured and certified. We are suing him for 60% costs as he was overly responsible for the entire project and appears to have failed to check the builders work.
We are also suing the technician who drew the foundation plans and calculated everything for 20% - he is fully insured and certified.
We found out yesterday we are looking at March 2012 before we are even given a preliminary court hearing date.
We contacted our bank - Cajasur - today to ask for a mortgage break or a reduction in monthly payments. They agreed to drop the payments from 1800 euros a months to 1200 euros for one year - as long as we paid 6000 euros to change the mortgage.
So in a nutshell - we will drop your payments but charge you more over the 12 month period!
We have a mortgage of around 325,000 euros on the property - and currently have around 275,000 pounds of our own money invested in it. We stand to lose all of this.
However given the state of the property it is easily in negative equity at present
Repairing the outside areas is estimated at around 250,000 euros - but we are now awaiting a second report on the house itself as our technician/architect believes the entire property has been built sub-standardly and is all at risk.
I have also today spoken to our accountant who has advised me to go bankrupt as this will prevent the bank chasing us should be hand the keys back
Our lawyer is Spanish but is also qualified to work in the UK
My wife also speaks fluent Spanish and she has been dealing with the bank - who have been horrific!
We have spoken to Homes From Hell and they are VERY keen to feature our story - however I dont know what benefit this is other than making good telly for viewers.
I hope this makes our situation a bit clearer

noelrosie

"We were offered a 10 year building insurance midway through the build but after speaking to our lawyer who explained the pros and cons we decided not to proceed with it"

Obviously it is too late now for you to go over all this again, but since we DO have 10 year build insurance on our villa, what are the cons?

Your situation is utterly horrifying and we feel for you ...

whitelinen

I cannot think of any reason to decline a 10 year building insurance, can you explain the reason s why you declined.

In any case I thought the 10 year insurance was mandatory not optional.

Mitzyboy

It is ... now. A builder has to supply it with a new build.

I find it strange that it was offered half way through the build. They way it was explained to me waqs that the building has to be inspected at all stages for the insurance to be given

HBG

Some realism here: A 600 metre build in a prime location on the CDS in 2006 would be worth well over a million pounds now.

Unfortunately, Lehmans went down in October 2007 and the property market the world over collapsed.

When the act of God took place, there could have been an option to use an Auf Wiedersehn Pet gang to put things right, and escape, but that option has long passed.

I’m very sorry to hear what has happened, but your accountant seems to have it right.

steviedeluxe

It's a pity we can't have steady house prices, instead of these manic booms followed by negative equity gloom. We're starting to see stories like this again

http://www.dailymail.co.uk/news/arti...ed-just-1.html

Alan73

HBG - trust me it doesnt get any more realistic than the situation we find ourselves in right at this very moment!
My wife and I are not the naive Brits you often read about in newspapers or see on the television.
You say we could have brought in a gang of workies to fix the problems following the Act of God. The cost of repairing the damage caused was an estimated 250,000 euros.
I dont know about your financial situation but that is not the kind of money we could simply get our hands on to repair the issues which has arisen.
We were advised that a 10 year building guarantee was hardly worth the paper it was printed on. If problems were to arise during that period and the builder had moved or gone out of business etc there would be no-one liable for the costs.
As Ive said this is a much longer more complicated story than I could post on here. But to sum it up - imagine coming home tomorrow to find your house falling down, be told you and your wife - three kids under 6 - all had to move out immediately, and every penny you had ever saved was more than likely to be lost unless you were willing to put every penny you made from that point forward into fighting a court case no-one could tell you how long it would take to complete - or even if you had a guarantee of winning!

Alan73

Also regards the building insurance - a builder has to indeed supply this with every new build - but because we contracted the builder and he was not building the house to sell it on at a profit he was not obligated to do so.
This is why you contract a lawyer to give you sound impartial advice on matters such as this. You put the questions you want answered to them and then act on what they tell you.
Based on what we were told by our lawyer we decided not to take out a 10 year building insurance as we felt it would not provide any insurance should the worst happen

agoreira

This same link has appeared here now, it can be quite different.

jonboy

What are the chances of selling the land the house sits on? I guess it must have value and would that cover some or all of the mortgage? I realise that you and your wife would be terribly out of of pocket, however it may mitigate some of the after effects, such as the banks chasing you in the future. I wish I could offer a more hopeful outcome.

Best regards

jonboy

Alan73

Hi Jon

Thats not really an option either unfortunately.
We bought the land outright for around 145000 euros just as the market was at its peak
If we sold it now we would get a fraction of that value. There are also numerous plots nearby which someone could buy and not have to worry about spending a small fortune either repairing our property or knocking it down and building a new house.
Be far cheaper to buy an alternative plot without those concerns
But all ideas and thoughts appreciated!

Alan

ANGELA YOUNG

My house is in Coin too!
It was nearly the ruin of us we put blood, sweat and lots of tears into our place.
I have been left with a bitter taste in my mouth when it comes to Spain and the b/s that goes along with owning rural property.
We have to live and learn i suppose!

missile

That would be a serious step to take. AFIK you cannot go bankrupt in spain if you have assets in the UK? You may be able to transfer UK assets but that I think that would be fraud?

agoreira

According to the article linked to says, "Bankruptcy is not the answer, either. Mortgage debt is specifically excluded here.(Spain)"

missile

It is impossible to get money from a man of straw. There are ways to hide assets, but debt collectors are very good. AFIK, no legal way out.