Court rules BBVA abusive — could more refunds follow?

When you get a mortgage, you expect to repay the loan and not the notary fees of your bank. That’s precisely what one Spanish court has ruled against this month, ordering BBVA to refund €684 to a client after declaring one of its mortgage clauses abusive. The clause at issue. It required borrowers to cover virtually all costs associated with their mortgages, ranging anywhere from administrative expenses to registration. 

This ruling may seem small but BBVA is facing a series of legal problems. Who pays for the fine print? And if you own a home in Spain, you might be owed money. 

What BBVA Did 

The couple did not agree only to the monthly payments when they took out a mortgage through BBVA. In the contract, it was stated that all fees would be paid, including notary fees, registration fees and paperwork. 

In total, it incurred €684 in extra costs, all of which were passed on to the customer, and BBVA did not cover a single cent. The Spanish court found that the clause violated consumer rights. Why? It broke the law. The judge stated that it unfairly shifted responsibility to the bank for violating consumer protection laws.

A bank can’t transfer the entire cost of doing business to a customer, and especially not via a contract that most people are unaware they can contest.

Now, BBVA must repay the €684, and the ruling could serve as a precedent for other homeowners in a similar situation. You might be eligible to get your fees back if they were all charged for your mortgage.

BBVA’s track records

It’s not the first case where BBVA contracts have been in the news or landed BBVA in court. In the 2010s it was criticized for “clausulas suelo” (floor Clauses) that set the minimum rate of interest on mortgages. Customers continued to pay high interest rates even when rates fell. Most of them did not know that this was going on.

The Spanish Supreme Court ruled in 2013 that these clauses were unfair. After that, the European Court of justice stepped up and told the banks, including BBVA, that they must refund all of the money the customers overpaid. Some homeowners received their money back.

BBVA also faced an investigation in recent years over high-profile corporate spying allegations. These scandals involved paying a former commissioner of police to gather information on rivals and journalists. 

Fallout, then, shook Spain’s financial world. It also triggered a series of internal reforms. This latest ruling, in short, is not an isolated error; it’s part of a pattern. The Spanish courts are now peeling away those layers. 

Can this affect your mortgage loan?

If you’ve taken out a Spanish mortgage within the last 10 or 15 years, it is possible that you are entitled to a refund. Spanish courts have ruled repeatedly that charging the customer for the administrative and notary costs of the mortgage is illegal. Especially if they are hidden in fine print or buried inside a contract which you did not negotiate.

• When you obtained your mortgage, did you pay the full amount of fees?
• Was it BBVA, or another major bank that signed the contract?
• Has your bank assigned a notary or stored it without you discussing it?

 In this case, the precedent in law is on your side. You may be entitled to claim hundreds or thousands of Euros depending on the circumstances. 

Spanish consumer groups, FACUA, OCU and others, encourage more people in Spain to take action. Although the process is long and involves lots of paperwork, there’s no reason for despair. If you haven’t looked at your mortgage before, it might be time.

The refund power

In the case of the client, winning back €684 may not seem like a significant amount. The ruling is a small step in the right direction, but it’s a big one, especially when you consider that nearly all households have some sort of debt. 

The fine print is important and even the most basic contract can be questioned if they cross the line. For BBVA, the case is yet another page in a lengthy legal history. But for everyone else, it proves that familiarity does not mean fairness.