EJECUCIÓN HIPOTECARIA Y PROTECCIÓN DEL DEUDOR HIPOTECARIO EN EL CONTEXTO DE LA CRISIS ECONÓMICA.

Abstract

In the current social and economic context of economic crisis, the situation is one in which consumers have gotten in over their heads in mortgage debt, foreclosures have multiplied and many fundamental rights have become involved, such as the right to effective judicial protection and the right to decent housing under articles 24 and 47 of the Spanish Constitution. This is the backdrop in which the Provincial Court of Appeals of Navarra handed down Ruling 111/2010 of 17 December. The ruling set off a storm of argument, because it declared that when a mortgage lender forecloses on a loan and the mortgaged property is awarded to the lender for less than its appraised value, the foreclosure proceedings must cease. This sparked debate in society and legal circles. The matter is a complex one, and a very important one in practice, and it has cast a harsh light on the imperfections of the Spanish system of mortgage foreclosure. This article takes legal doctrine and case law in hand for a hard look at the advisability or inadvisability of acknowledging that the mortgage borrower is entitled to be released from the debt if he surrenders the mortgaged property to the lender -in short, the possibility of limiting borrower liability. Royal Decree-Law 6/2012 of 9 March on urgent measures for the protection of indigent mortgage loan holders was created to provide solutions to the problem of mortgage over-indebtedness. It is complemented by a good practice code that suggests a number of measures that would allow borrowers in extraordinary financial difficulties to restructure their mortgage debt. The code also outlines mechanisms for making foreclosure procedures more flexible, more transparent and cheaper through a new on-line auction system without detracting from the fundamental elements of mortgage collateral.