The effectiveness of the mortgage guarantee in evident detriment

Abstract

The recent and numerous legal rulings as much from the European Court of Law as from the Spanish Courts, declaring unfair many of the mortgage loan clauses and its inadequacy of foreclosure follow a laudable purpose: the consumer's protection in agreement with the European regulations— our regulation—. However, I consider that there is an increasing risk for the mortgage guarantee to lose its effectivity, because as a consequence of these legal rulings it could become something different. The mortgage guarantees the capitals positions and the real estate loans but it can derívate into a petty guarantee that leads us to a legal uncertainty provoking a new financial crisis. In this paper I analyze the last legal rulings in a critical way, forewarning the consequences that may have to follow this judicial trend.