The recent conclusions of the Advocate General of the Court of Justice of the European Union, Maciej Spuznar, on mortgages referenced to the IRPH index, have generated very positive expectations in those affected by it. Although their conclusions are not binding nor do they allow us to anticipate the result, the truth is that they provide relief for many families who have been paying an unbearable extra cost on their mortgage.
The IRPH, like the Euribor, is a reference index to which the interest payable on a loan is calculated. The IPRH was calculated as the average rate of mortgage loans for more than three years granted by banks and savings banks. The reason for this index was the need for a new official reference calculated by the Bank of Spain under strict transparency rules, taking as an example models of rates considered stable in Europe, and which protected the client against the instability of the financial markets.
In the years 2007 and 2008, the most expensive period of the Euribor, in which it stood above 5%, the lower volatility of the IRPH popularized it as a mortgage reference index, as perceived by consumers as a more stable and secure option.
However, alarms jumped when, between 2013 and 2016, Euribor rates were close to zero, compared to those of IRPH, whose rates were stagnant at 2%. Thus, those who had their mortgage referenced to the IRPH paid much higher fees than those who had it to the Euribor.
Since then there are many procedures urged by those affected, in claim of differences due to cost overruns paid in the mortgage loan installments. And, as usually happens when a new bank abuse emerges, the fate of the first claims has been uneven.
In fact in Judgment of December 14, 2017, the Supreme Court ruled in favor of the bank when considering that “the mere reference of a mortgage to IRPH does not imply a lack of transparency or abuse" Luckily, the discrepancy of the particular votes of magistrates Javier Orduña and Francisco Arroyo, who considered that there was an opacity in these mortgages, allowed to keep the opposite criterion alive.
The tendency of the judicial resolutions at this time, at least in the first instances, anticipating what the Court of Justice of the European Union (CJEU) resolves, is to consider the interest rate clause abusive and that there has been a lack of transparency in its commercialization
And, in the generality of the cases, those affected did not receive detailed and complete information about the index, they were not warned of their risk, they were not provided with simulations of different scenarios to explain the predictable behavior of the interest rate, nor They were provided with cost comparisons with other loan modalities of the entity itself.
The Advocate General of the CJEU, on September 10, 2019, has come to confirm this criterion, since he concludes that the index can be subject to judicial control to determine if it is abusive or if it was marketed transparently, and that the formula Mathematics for calculating the index is complex and not very transparent for an average consumer.
In the same way that happens with other banking products, the Advocate General recalls that the information that the bank had to provide to the client should be sufficient to make a prudent decision and with full knowledge of the method of calculating the applicable interest rate and the elements that compose it. In addition, the financial entity has the obligation to inform the consumer about the historical evolution of the IRPH and the foreseeable behavior of the index in the different possible scenarios.
Although the opinion of the European Union Attorney is not binding, without a doubt, we find great news for Spanish consumers, in the face of the initial position of the Supreme Court that, if the conclusions are confirmed, he will receive a new blow and amendment from the TJUE regarding financial and banking products.
We will have to wait, however, for the Court of Justice of the European Union to rule, since the conclusions of the Advocate General are not binding, although the statistics say that, the resolutions usually include the conclusions of the Advocate General in the majority of the cases. If the conclusions are confirmed in a favorable Judgment of the Court of Justice of the European Union, it is expected that those affected can recover the interest paid in excess.
In line with all this, there is also an interesting issue that jurisprudence must specify and that will have an important impact on the amounts that the affected consumers can recover. What consequences should the declaration of nullity have on the interest accrued?
It is estimated that, if the nullity should result in the return of the interest charged in excess of those paid in reference to the Euribor, the amounts to be recovered for each affected party could be around twenty thousand euros on average. To this, it could be considered to add interest on the most satisfied amounts.
On the other hand, if the effect of the nullity implies that the loan is without any interest, neither of the IRPH nor another that replaces it, the consequence would be the restoration of the situation of the consumer to which it was at the time of contracting the loan, as if that clause had not existed. In this case the compensation would be even greater.
Some resolutions have embraced this formula, reproducing the argumentation of the STJUE of December 21, 2016, which concludes that a contractual clause declared abusive has never existed, so that it cannot have an effect on the consumer.
However, the good news in the judicial field does not relieve the pockets of consumers. Therefore it is important consider whether in the current situation it is appropriate to subrogate the mortgage with IRPH, novate it to pass to the Euribor or cancel it, when this is possible, and if this would affect the right to claim or recover the amounts paid in excess, once the judicial landscape is clear.
The subrogation, novation or cancellation of the mortgage loan does not imply acceptance, nor remedy the abuse and lack of transparency suffered in the contracting. In the worst case, the action to request the declaration of nullity prescribes four years after the cancellation of the loan linked to the IRPH, so, at least during this period, the possibility of claiming against the entity with the That the loan was subscribed.
In our opinion, we are faced with a nullity assumption, so the term would be imprescriptible. Even if in such a case, the claim could be made even after the 4-year term has elapsed, it should be claimed in advance of that period, to avoid discussions about it.
Whether you continue to suffer the effects of an IRPH mortgage, or if you were affected in your day and have decided to claim, feel free to contact LAWYERS RIBELLES, where we can help you defend your rights and interests, and we will clarify any questions you have about it.
FRANCISCO ORTIGOSA / JULIO RIBELLES
