Thousands paying up to €200 extra per month on their Spanish property mortgages

  • Inclusion of Cláusula Suelo (Ground Clause) in mortgages provides potential for refunds
  • Affected property owners blocked from benefits of falling interest rates
  • CostaLuz Lawyers has already won many Ground Clause cases for UK owners

The Spanish property law experts at CostaLuz Lawyers are seeking to alert anyone who owns property in Spain that they may be able to claim refunds on their mortgage payments. The move follows a string of wins in the courts for property owners with a Cláusula Suelo (Ground Clause) in their mortgages.

The Ground Clause was included in many Spanish mortgages. It establishes a minimum interest rate applicable to mortgage repayments, meaning that variable rate or tracker mortgages never saw the benefits of falling interest rates filter through to the mortgage holders. In many instances, the banks issuing the mortgages did not clearly explain the implications of the Ground Clause. This has created the potential for mortgage holders to claim back the overpayments.

“While variable rate and tracker mortgages are linked to the Euribor rate, the inclusion of Cláusula Suelo meant that the interest rate could never drop below a much higher rate fixed by the bank. This has seen many mortgage holders paying several percentage points more in interest than they should have been over the past decade and more. We are keen to alert them that there is hope for having Ground Clauses removed from the mortgages and for reclaiming the overpaid interest.”

Keith Rule, CostaLuz Lawyers

When the markets crashed at the end of 2008, so did the Euribor rate. This meant that, from early 2009, mortgage holders should have been paying much lower interest. However, those with a Ground Clause in their mortgage weren’t able to do so.

CostaLuz Lawyers reports that the existence of the Floor Clause implies a surplus in mortgage repayments, in general, of around €200 per month. On a 130,000€ mortgage taken out in 2006 over 30 years at Euribor + 1%, with a 4.25% Ground Clause, the mortgage holder would be due a refund of overpaid interest of around €20,000. Successful cases also see the Ground Clause removed from the mortgage, meaning that the property owner can also benefit from lower monthly payments directly linked to the Euribor rate in future.

“Both the Spanish and European courts have ruled that banks must refund all the overcharged interest since the very first application of the Ground Clause, together with default interest and legal costs. This applies even where mortgage agreements have passed from bank to bank during mergers and acquisitions.” 

Keith Rule, CostaLuz Lawyers

Banks are given three months to respond to initial Cláusula Suelo claims brought against them. This means that some property owners may receive refunds without going through the courts. Where banks refuse to engage, however, the CostaLuz Lawyers team is ready and waiting to take appropriate legal action.

The firm has already won nearly 850 claims (in relation to Cláusula Suelo and other legal matters) from Spanish property developers and banks. In the process, it has helped more than 1,500 clients from the UK and Ireland, as well as Spanish and European nationals. Now, by publicising the Ground Clause scandal more widely, the firm hopes to help even more property owners reclaim what is rightfully theirs.


For more information, please contact CostaLuz Lawyers’ UK office on +44 1908 635 111 and speak with Keith. To speak with Maria in the Spanish office, call +34 956 092 687 or you can visit