Q. I read your article regarding community debtors who cannot be denied use of the swimming pool. We are a community on the Costa Blanca with the same problem of non-paying debtors.
In our case we have debtors who let their properties and therefore receive rents. However these owners do not pay the community fees. We have taken court action and obtained judgements against them but still they do not pay and it seems they have no intention of paying. I was advised that, if an owner does not pay the fees, then the mortgage provider must be advised and action may be taken by them. A further issue is that the downturn in property values has put these apartments into ‘negative equity.’ One owner has suggested that we may be able to insist that any rents paid by the tenants should be paid to us, the Community, and not to the non-paying owners.
Can you advise?
K.G. (Costa Blanca)
A. Yes, you can obtain a court order against any assets or income that the debtor has in Spain. In fact, I am surprised that your lawyer has not already advised the community to take this step. If you have a court ruling that the debtors must pay, the next logical step is to locate any assets they have in Spain and proceed to seize them for the debt. This would include bank accounts, property, and rental income, whichever is the most convenient and effective.
If the debtor is not a resident of Spain, with other property here, his only asset in the country is the apartment he owns. In the first place, the court can order the tenants to pay the rental on the flat directly to the court, for final payment to the community. If seizing the apartment to sell at auction is the last resort, this is more complicated.
The court may inform the mortgage provider that legal action is being taken against the mortgage holder, especially if the flat itself is being seized. After all, the bank has a financial interest in the property. The fact that the property is in ‘negative equity’ does not influence any of these proceedings.