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Avoiding the risk of Spanish property embargoes

It can come as something of a surprise that in Spain certain authorities have the power to embargo your property and, ultimately, put it up for auction if a bill remains unpaid.


Unpaid bills can lead to homes being embargoedLet’s take one particularly disturbing example of what can happen. Mrs Jones is a non-resident who used to own a property in Spain. In July, unknown to her, it went to property auction and was sold to a third party for a price of less than half its value. The reason? She had failed to pay her I.B.I (council tax) bill and combined with fines and interest she owed €1,700.

What was perhaps even more worrying was that Mrs. Jones hadn’t a clue what was happening as she had not been in Spain to receive her mail and there was no one available to check her post box. The other means of informing her of her debt also passed her by.

The Boletín official del estado is a list of debts and other notifications published over the internet and on paper. A debt warning published on this list counts as an official notification. It includes anything from traffic fines to divorce announcements. It is not the kind of website that you visit daily on the off chance of seeing your name.

What happened to Mrs. Jones is relatively rare. However, we are seeing an increasing number of cases and this form of repossession is much quicker than the legal route banks have to take. In less than a year a property can be embargoed and sold on to recover the debt.

Although Mrs. Jones was a non-resident and particularly vulnerable to not receiving important mail, the same applies to residents who take extended visits back to their home country. If you do have a fiscal representative then they should receive notifications and be able to alert you if a problem is arising. The Spanish authorities will only do as much as they need to by law to inform you of your debt and pending actions. The rest is up to you.

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