This post is also available in: Spanish
By Pilar Paricio
The European Court of Justice has judged that Spanish eviction law violates European Law as it doesn’t protect citizens from possible abusive clauses that banks have included in their mortgage contracts. Specifically Spanish law prevents judges from suspending an eviction in the case where mortgage clauses are considered to be abusive.
The European Court declared that Spanish Law, in this matter, is contrary to EU Law.
On reviewing the situation of access to housing in recent years, we see that from 2001, real estate speculation and the ease of accessing cheap loans has generated a disproportionate rise in the cost of housing in Spain. Housing went from being a basic right of citizens to becoming a refuge for speculative capital and black market money. When a Spanish family wants to become independent, they have to get a mortgage in order to acquire a house which in many cases is for almost the whole of their income and for a period of time greater than their working life
Bankers, the media, politicians and others well-versed in this matter repeated to the population that this was a secure investment, that if in the future they were unable to make their repayments they could simply sell the property and recover their investment and even make a profit.
Financial companies strongly encouraged families to take out loans, disregarding whether the families could afford them or not.
In 2008 a housing crisis erupted and the cost of housing plummeted. Alongside this a strong economic crisis left a quarter of the working population out of work. Many families that bought properties with mortgages, due to the economic crisis at that time, found themselves in the position of not being able to make their repayments.
Since the start of the crisis there have been more than 400,000 evictions in Spain. The living situation for many families has become desperate.
This was the case for Mr Aziz who in July 2007 took out a mortgage with the Catalunya Caixa Bank for 138,000 euros to buy a family home. In June 2008 he stopped being able to repay the mortgage.
After demanding payment, the bank started an eviction process. A public auction took place without any offers being made for the property which meant that in accordance with Spanish law the property was turned over to the bank for 50% of its value. On the 20th of January, Mr Aziz was evicted. Aziz made a case to annul this clause of his mortgage contract due to its abusive nature and therefore declare void the eviction process.
In light of this, Mercantile Court no 3 in Barcelona decided to refer to the case to the European Union Court of Justice to find out if Spanish law conforms to European norms. On the 14th of March, the Court of Justice declared that Spanish law is not in line with European Union law in respect of these abusive clauses.
This is the first triumph of ordinary people over the abusive conditions of financial and political power.
Numerous collectives, platforms, associations and neighbourhood groups have fought for all these years against evictions, against the debt for life after losing ones home, and against the abusive conditions to access housing. There are examples such as the Mortgage Holders Platform that has managed to promote a Popular Legislative Initiative supported by almost 1.5 million signatures.
This proposed law says that in the case where someone can’t pay their mortgage, they have the possibility to give it back to the bank and free themselves of the debt, plus they would have the right to stay living in the property for a period of 5 years on payment of rent.
There are other examples such as those of the 15M neighbourhood assemblies that have prevented numerous evictions; and examples such as neighbourhood groups and platforms that have occupied empty apartment blocks owned by the banks.
The decision by the European Union Court of Justice obliges the Spanish government to reform the mortgage law.
For years now it has seemed urgent to have a profoud debate in Parliament about mortgage laws, the Popular Legislative Initiative presented by citizens and definitely about how to make effective a very diminished right today in Spain: the right to dignified housing.