Banks demand mortgage payment for the houses buried by the La Palma volcano

Some banks of the Canary Islands in Spain, are demanding payment of the mortgage of the houses buried by the volcano from La Palma. They claim the compensation as their own.

The institutions informed their clients that they lost vhouses or other properties, which must pay the entire mortgage loan with the money received from the Insurance Consortium.

Affected families complained to the administration of the Islands considering the practice as improper, considering that they lost their homes due to the eruption of the volcano.

Foto: Twitter @RoiLopezRivas

The victims argued that this is an exceptional situation. Then, they study the possibility of a class action lawsuit against the banks.

The volcano Cumbre Vieja erupted on September 19 and thousands of people they were displaced from their homes.

“Although in almost all cases the money from the appraisal does not compensate the value of the house destroyed by the volcano, the bank imposes the payment of the mortgage“, wrote RT, citing local sources.

Lawyers consulted in this regard said that the The principal obligation of the loan consists of a determined and obligatory payment.

And only in the event of non-payment, the clause of mortgage property and claim the full amount of the debt.

On the other hand, the object of the insurance is the house, not the loan. So once the property is gone, the client continues to have the obligation to repay the loan.

The banks involved have a different version. They consider that the insurance was granted as a requirement to grant the mortgage.

And in a clause of the contract, it establishes that the beneficiary of the insurance is the banks in the event of a catastrophe such as the eruption of volcano Cumbre Vieja.

So far, the Insurance Consortium has covered 10 percent of the requests, an approximate of 13 million euros in compensation.


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