Although most mortgages in Spain are indexed to Euribor rate, which is currently at its lowest levels, there are still many loans linked to a much more damaging index IRPH.
The Euribor is at historic lows … but thousands of citizens can not use it, because that does not translate into lowering their mortgages. The culprit, ground clause included in their mortgage contracts, or that their loan remains referenced to another index, the IRPH.
Although most mortgages in Spain are indexed to Euribor rate, which is currently at its lowest levels, there are many loans linked to a much more damaging index, the IRPH yet. Who have a mortgage referenced to this index is paid expensive: the figure varies depending on the amount and the repayment period, but we estimate that in the average mortgage, having this as detrimental index represents around 1,200 euros a year.
An unwise index
The IRPH is an index developed on the basis of loans granted by banks and does not accurately reflect the evolution of interest rates, since it is influenced by the institutions themselves with the policy of guys who want to apply their loans. Usually the index IRPH has always placed well above the Euribor. His only “supposed” advantage was stability. OCU has repeatedly warned that this index was not recommended, even so, many organizations put the index hundreds of thousands of users, who now face expensive mortgages only benefit the bank.
Mobilize against this banking abuse
Thousands of victims have claimed their banks and requesting that the IRPH was replaced by the Euribor plus a spread, without success. The only solution for them is to go to court and fight for it, if it was not clearly informed customers, IRPH abusive clauses are declared null and as such, as has already happened with the floor clauses.
We already have numerous rulings in lower courts that have been positive for those affected. The first in the Basque Country and the most recent in Barcelona. As an example, the judgment of the trial court of Barcelona declared “null and void by the general condition of abusive recruitment … that establishes the benchmark mortgage loan IRPH of savings”.